UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number 811-5344
William Blair Funds
(Exact name of registrant as specified in charter)
222 West Adams Street, Chicago, IL | 60606 | |
(Address of principal executive offices) | (Zip Code) |
Michelle R. Seitz
William Blair Funds
222 West Adams Street, Chicago, IL 60606
(Name and address of agent for service)
Registrant’s telephone number, including area code: 312-236-1600
Date of fiscal year end: December 31
Date of reporting period: December 31, 2014
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A Registrant is not required to respond to the collection of information contained in Form N-CSR unless the form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimates and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. (ss) 3507.
Item 1. | February 20, 2015 Annual Reports transmitted to shareholders. |
December 31, 2014
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William Blair Funds
Annual Report
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Table of Contents
December 31, 2014 | William Blair Funds | 1 |
The views expressed in the commentary for each Fund reflect those of the portfolio management team only through the end of the period of the report as stated on the cover. The portfolio management team’s views are subject to change at any time based on market and other conditions and should not be construed as a recommendation. Statements involving predictions, assessments, analyses, or outlook for individual securities, industries, market sectors, and/or markets involve risks and uncertainties, and there is no guarantee they will come to pass.
This report is submitted for the general information of the shareholders of William Blair Funds. It is not authorized for distribution to prospective investors unless accompanied or preceded by a prospectus of William Blair Funds. Please carefully consider the Funds’ investment objectives, risks, charges, and expenses before investing. This and other information is contained in the Funds’ prospectus, which you may obtain by calling 1-800-742-7272. Read it carefully before you invest or send money.
2 | Annual Report | December 31, 2014 |
PERFORMANCE AS OF DECEMBER 31, 2014—CLASS N SHARES (Unaudited)
10 yr | Overall | |||||||||||||||
(or since | Inception | Morningstar | ||||||||||||||
1 yr | 3yr | 5 yr | inception) | Date | Rating | |||||||||||
Growth Fund | ||||||||||||||||
Class N | 6.59 | 18.51 | 13.24 | 8.46 | 3/20/1946 | **** | ||||||||||
Morningstar Large Growth | 10.00 | 19.41 | 14.09 | 7.68 | Among 1,528 | |||||||||||
Russell 3000® Growth Index | 12.44 | 20.25 | 15.89 | 8.50 | Large Growth Funds | |||||||||||
S&P® 500 Index | 13.69 | 20.41 | 15.45 | 7.67 | ||||||||||||
Large Cap Growth Fund | ||||||||||||||||
Class N | 14.29 | 21.61 | 14.97 | 7.09 | 12/27/1999 | *** | ||||||||||
Morningstar Large Growth | 10.00 | 19.41 | 14.09 | 7.68 | Among 1,528 | |||||||||||
Russell 1000® Growth Index | 13.05 | 20.26 | 15.81 | 8.49 | Large Growth Funds | |||||||||||
Large Cap Value Fund | ||||||||||||||||
Class N | 8.35 | 19.06 | — | 17.77 | 10/24/2011 | *** | ||||||||||
Morningstar Large Value | 10.21 | 18.33 | — | — | Among 1,106 | |||||||||||
Russell 1000® Value Index | 13.45 | 20.89 | — | 20.16 | Large Value Funds | |||||||||||
Mid Cap Growth Fund | ||||||||||||||||
Class N | 7.53 | 15.37 | 14.12 | 8.45 | 2/1/2006 | *** | ||||||||||
Morningstar Mid-Cap Growth | 7.00 | 18.21 | 14.76 | — | Among 645 | |||||||||||
Russell MidCap® Growth Index | 11.90 | 20.71 | 16.94 | 8.50 | Mid-Cap Growth Funds | |||||||||||
Mid Cap Value Fund | ||||||||||||||||
Class N | 10.83 | 18.27 | — | 13.23 | 5/3/2010 | *** | ||||||||||
Morningstar Mid-Cap Value | 9.31 | 19.93 | — | — | Among 421 | |||||||||||
Russell Midcap® Value Index | 14.75 | 21.98 | — | 14.98 | Mid-Cap Value Funds | |||||||||||
Small-Mid Cap Growth Fund | ||||||||||||||||
Class N | 8.33 | 19.81 | 16.06 | 9.91 | 12/29/2003 | **** | ||||||||||
Morningstar Mid-Cap Growth | 7.00 | 18.21 | 14.76 | 8.29 | Among 645 | |||||||||||
Russell 2500TM Growth Index | 7.05 | 20.47 | 17.27 | 9.37 | Mid-Cap Growth Funds | |||||||||||
Small-Mid Cap Value Fund | ||||||||||||||||
Class N | 4.66 | 16.89 | — | 18.31 | 12/15/2011 | *** | ||||||||||
Morningstar Small Blend | 3.79 | 17.85 | — | — | Among 624 | |||||||||||
Russell 2500® Value Index | 7.11 | 19.40 | — | 20.70 | Small Blend Funds | |||||||||||
Small Cap Growth Fund | ||||||||||||||||
Class N | 2.62 | 22.81 | 13.28 | 6.62 | 12/27/1999 | *** | ||||||||||
Morningstar Small Growth | 2.44 | 18.07 | 15.53 | 8.05 | Among 645 | |||||||||||
Russell 2000® Growth Index | 5.60 | 20.14 | 16.80 | 8.54 | Small Growth Funds | |||||||||||
Small Cap Value Fund | ||||||||||||||||
Class N | 4.49 | 17.75 | 14.75 | 7.97 | 12/23/1996 | *** | ||||||||||
Morningstar Small Blend | 3.79 | 17.85 | 14.61 | 7.55 | Among 624 | |||||||||||
Russell 2000® Value Index | 4.22 | 18.29 | 14.26 | 6.89 | Small Blend Funds | |||||||||||
Global Leaders Fund | ||||||||||||||||
Class N | 3.76 | 13.71 | 11.33 | 2.56 | 10/15/2007 | **** | ||||||||||
Morningstar World Stock | 2.79 | 14.11 | 9.54 | — | Among 881 | |||||||||||
MSCI ACW IMI (net) | 3.84 | 14.30 | 9.48 | 2.34 | World Stock Funds |
December 31, 2014 | William Blair Funds | 3 |
PERFORMANCE AS OF DECEMBER 31, 2014—CLASS N SHARES (Unaudited)—CONTINUED
10 yr | Overall | |||||||||||||||
(or since | Inception | Morningstar | ||||||||||||||
1 yr | 3yr | 5 yr | inception) | Date | Rating | |||||||||||
Global Small Cap Growth Fund | ||||||||||||||||
Class N | 4.93 | — | — | 16.86 | 4/10/2013 | Not rated. | ||||||||||
Morningstar World Stock | 2.79 | — | — | — | ||||||||||||
MSCI ACW Small Cap Index (net) | 1.78 | — | — | 11.02 | ||||||||||||
International Leaders Fund | ||||||||||||||||
Class N | (2.67 | ) | — | — | 9.84 | 8/16/2012 | Not rated. | |||||||||
Morningstar Foreign Large Growth | (3.92 | ) | — | — | — | |||||||||||
MSCI ACW Ex-U.S. IMI (net) | (3.89 | ) | — | — | 8.38 | |||||||||||
International Equity Fund | ||||||||||||||||
Class N | (3.09 | ) | 10.83 | 5.64 | 3.67 | 5/24/2004 | *** | |||||||||
Morningstar Foreign Large Growth | (3.92 | ) | 10.84 | 6.13 | 5.11 | Among 294 | ||||||||||
MSCI World Ex-U.S. Index (net) | (4.32 | ) | 10.47 | 5.21 | 4.64 | Foreign Large Growth Funds | ||||||||||
International Growth Fund | ||||||||||||||||
Class N | (3.19 | ) | 12.39 | 7.83 | 5.74 | 10/1/1992 | **** | |||||||||
Morningstar Foreign Large Growth | (3.92 | ) | 10.84 | 6.13 | 5.11 | Among 294 | ||||||||||
MSCI ACW Ex-U.S. IMI (net) | (3.89 | ) | 9.22 | 4.71 | 5.37 | Foreign Large Growth Funds | ||||||||||
International Small Cap Growth Fund | ||||||||||||||||
Class N | (8.43 | ) | 11.62 | 8.99 | 6.41 | 11/1/2005 | *** | |||||||||
Morningstar Foreign Small/Mid Growth | (5.40 | ) | 13.65 | 9.63 | — | Among 126 | ||||||||||
MSCI ACW Small Cap | Foreign Small/Mid Growth Funds | |||||||||||||||
Ex-U.S. Index (net) | (4.03 | ) | 10.84 | 6.80 | 6.25 | |||||||||||
Emerging Markets Leaders Fund | ||||||||||||||||
Class N | 2.17 | 6.87 | — | 3.29 | 5/3/2010 | **** | ||||||||||
Morningstar Diversified Emerging Markets | (3.01 | ) | 4.65 | — | — | Among 521 Diversified Emerging Markets Funds | ||||||||||
MSCI Emerging Markets Index (net) | (2.19 | ) | 4.04 | — | 1.37 | |||||||||||
Emerging Markets Growth Fund | ||||||||||||||||
Class N | 3.40 | 8.04 | 5.19 | 9.19 | 6/6/2005 | ***** | ||||||||||
Morningstar Diversified Emerging Markets | (3.01 | ) | 4.65 | 1.81 | — | Among 521 Diversified Emerging Markets Funds | ||||||||||
MSCI Emerging Markets IMI (net) | (1.79 | ) | 4.46 | 1.93 | 8.54 | |||||||||||
Emerging Markets Small Cap Growth Fund | ||||||||||||||||
Class N | 14.41 | 21.37 | — | 18.96 | 10/24/2011 | ***** | ||||||||||
Morningstar Diversified Emerging Markets | (3.01 | ) | 4.65 | — | — | Among 521 Diversified Emerging Markets Funds | ||||||||||
MSCI Emerging Markets Small Cap Index (net) | 1.01 | 7.65 | — | 5.01 | ||||||||||||
Bond Fund | ||||||||||||||||
Class N | 5.10 | 3.94 | 5.41 | 5.60 | 5/1/2007 | **** | ||||||||||
Morningstar Intermediate-Term Bond | 5.18 | 3.38 | 4.78 | — | Among 913 | |||||||||||
Barclays U.S. Aggregate Bond Index | 5.97 | 2.66 | 4.45 | 4.99 | Intermediate-Term Bond Funds |
4 | Annual Report | December 31, 2014 |
PERFORMANCE AS OF DECEMBER 31, 2014—CLASS N SHARES (Unaudited)—CONTINUED
10 yr | Overall | |||||||||||||||
(or since | Inception | Morningstar | ||||||||||||||
1 yr | 3yr | 5 yr | inception) | Date | Rating | |||||||||||
Income Fund | ||||||||||||||||
Class N | 3.06 | 2.44 | 3.70 | 3.26 | 10/1/1990 | *** | ||||||||||
Morningstar Short-Term Bond | 1.07 | 1.70 | 2.31 | 2.94 | Among 435 | |||||||||||
Barclays Intermediate | Short-Term Bond Funds | |||||||||||||||
Government/Credit Bond Index | 3.13 | 2.03 | 3.54 | 4.10 | ||||||||||||
Low Duration Fund | ||||||||||||||||
Class N | 1.20 | 1.12 | 1.39 | 1.24 | 12/1/2009 | **** | ||||||||||
Morningstar Ultra Short Bond | 0.34 | 1.03 | 1.24 | — | Among 104 | |||||||||||
Bank of America Merrill Lynch | Ultrashort Bond Funds | |||||||||||||||
1-Year U.S. Treasury Note Index | 0.18 | 0.23 | 0.41 | 0.38 | ||||||||||||
Macro Allocation Fund | ||||||||||||||||
Class N | 2.55 | 9.84 | — | 10.46 | 11/29/2011 | ***** | ||||||||||
Morningstar Multialternative | 1.81 | 4.16 | — | — | Among 204 | |||||||||||
BofA Merrill Lynch 3-Month U.S. Treasury | Multialternative Funds | |||||||||||||||
Bill Index | 0.03 | 0.07 | — | 0.07 | ||||||||||||
Long-Term Comparative Index | 3.72 | 5.29 | — | 5.63 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or a loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Investing in smaller companies involves special risks, including higher volatility and lower liquidity. International and emerging markets investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. As interest rates rise, bond prices will fall and bond funds may become more volatile. Class N shares are available to the general public without a sales load.
Morningstar RatingsTM are as of 12/31/2014 and are subject to change every month. The ratings are based on a risk-adjusted return measure that accounts for variation in a fund’s monthly performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each Category receive 5 stars, the next 22.5% receive 4 stars, the middle 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five- and ten-year (if applicable) Morningstar Rating metrics. The 3/5/10 year Morningstar ratings were as follows: Growth Fund ***/***/**** and Large Cap Growth Fund ****/***/***, out of 1,528/1,324/909 large growth funds; Large Cap Value Fund ***/NA/NA, out of 1,106/NA/NA large value funds; Mid Cap Growth Fund **/***/NA and Small-Mid Cap Growth Fund ****/****/**** out of 645/584/429 mid-cap growth funds; Mid Cap Value Fund ***/NA/NA, out of 421/NA/NA mid-cap value funds; Small Cap Growth Fund *****/**/**, out of 645/566/394 small growth funds; Small-Mid Cap Value Fund ***/NA /NA and Small Cap Value Fund ***/***/*** out of 624/567/362 small blend funds; Global Leaders Fund ***/****/NA out of 881/688/NA world stock funds; International Equity Fund ***/***/** and International Growth Fund ****/****/*** out of 294/275/161 foreign large growth funds; International Small Cap Growth Fund ***/***/NA out of 126/97/NA foreign small/mid growth funds; Emerging Markets Leaders Fund ****/****/NA, Emerging Markets Growth Fund ****/*****/NA, and Emerging Markets Small Cap Growth *****/NA/NA out of 521/341/NA diversified emerging markets funds; Bond Fund ****/****/NA out of 913/807/NA intermediate-term bond funds; Income Fund ****/****/*** out of 435/378/271 short-term bond funds; Low Duration Fund ***/****/NA out of 104/79/NA ultrashort bond funds; and Macro Allocation Fund *****/NA/NA out of 204/NA/NA multialternative funds.
Please carefully consider the Funds’ investment objectives, risks, charges, and expenses before investing. This and other information is contained in the Funds’ prospectus, which you may obtain by calling 1-800-742-7272. Read it carefully before you invest or send money.
December 31, 2014 | William Blair Funds | 5 |
U.S. Growth Market Review and Outlook
The market’s advance in 2014 was fueled by positive domestic economic data, strong corporate earnings, continued accommodative policy from global central banks, and increased merger and acquisition activity. The U.S. economy strengthened over the course of the year in marked contrast to many other leading economies. With this backdrop, the U.S. stock market moved steadily higher through much of the year and selloffs were relatively short-lived.
In contrast to the subdued volatility environment that preceded it, volatility spiked higher in the fourth quarter of 2014. This was the result of two conflicting views of the economic, and therefore, equity market outlook. On one hand, substantial parts of the global economy, including Europe, Japan, and China, appeared to be slowing. In addition, commodity prices—especially oil—collapsed, leading to fears around deflation and the sustainability of economic growth and corporate earnings. On the other hand, the U.S. economy appeared to be quite healthy, as evidenced by robust economic growth in the second and third quarters of 2014 which was supported by a strengthened U.S. consumer. Improvement in the labor and housing markets, as well as the recent drop in energy prices, bolstered consumer confidence. Heightened fourth quarter volatility was reflective of these divergent dynamics.
From a style perspective, in the mid-March to May time frame, there was a pronounced rotation away from higher growth companies towards cheaper stocks with lower growth prospects. The catalyst for this massive internal market rotation was likely due to a combination of surprising negative first quarter economic growth and geopolitical concerns that created less willingness to value longer duration earnings streams, thus pressuring the valuation of higher growth companies. In terms of size, while mixed on a quarter-by-quarter basis, mid and large cap performance substantially exceeded that of small caps during the year. From a sector perspective, strength was generally broad-based, though the energy sector was a notable underperformer. Increased global oil supply coupled with reduced global energy demand resulted in crude oil trading down 50% from its June peak and translated into sharply negative returns for the sector.
Moving into 2015, the U.S. economy and stock market have several tailwinds including positive trends in employment and housing data and lower gas prices to boost disposable income. Robust demand dynamics within the U.S. should provide support for the earnings of U.S. companies. However, there is considerable uncertainty as to how insulated the U.S. will be from the rest of the globe where the outlook is more challenged. China’s growth continues to slow, despite monetary easing, and Eurozone growth remains sluggish, in part due to the drag caused by the Russian recession. Together with the implications of a strengthening U.S. dollar, these factors pose a threat to U.S. economic growth. Additionally, the timing of monetary policy implementation within the U.S. remains a notable risk. Though U.S. economic data has been solid, low inflation, reinforced by weak commodity prices, has enabled the Federal Reserve (“the Fed”) to keep interest rate hikes on hold. A weak global outlook, to the extent it challenges U.S. growth, could forestall or slow the pace of tightening. We expect the market to remain highly sensitive to incremental guidance from the Fed.
With respect to our outlook for equities, we believe the strong returns of the past five years are unlikely to persist over the next five years. Just as we believe the absolute level of market return will normalize, we believe that the abnormally low level of volatility that has accompanied such strong returns will continue to moderate. In the end, while we factor various economic and market scenarios into our stock picking, we focus our time on constructing portfolios from a bottom-up perspective and continue to find good ideas across sectors.
6 | Annual Report | December 31, 2014 |
U.S. Value Market Review and Outlook
Following up on robust performance in 2013, the market’s continued advance in 2014 was fueled by positive domestic economic data, strong corporate earnings, continued accommodative policy from global central banks, and increased merger and acquisition activity. While the market marched steadily higher through much of the year, volatility increased as the year progressed and selloffs were swift and relatively short-lived. Federal Reserve (the “Fed”) comments surrounding the future trajectory of interest rates prompted a strong style rotation from mid-March to May wherein the market rotated away from higher growth companies towards cheaper stocks with lower growth prospects. From there, with the exception of July weakness resulting from geopolitical tensions, the market continued in an upward trajectory until late September.
In contrast to the relatively benign environment leading up to the fourth quarter, volatility spikes in October and December resulted in two sharp, but brief, selloffs. Diminished optimism about U.S. growth prospects, speculation about the Fed’s tightening, and weakness in European and Chinese economic data drove the selloff that culminated in mid-October. The subsequent rally that persisted into November, recovering to year-to-date highs, was driven by strong corporate earnings. The selloff in mid-December seemed mostly tied to the further implosion in oil prices and concern that there was no end in sight. In addition, investors appeared fatigued after the significant rally off the October lows, pausing to gather steam in order to finish the year strong.
Looking forward, U.S. corporate earnings should be supported by solid domestic economic data, including an improved employment landscape, steady housing data, and lower gas prices to support increased consumer spending. However, there is considerable uncertainty as to how insulated the U.S. will be from the rest of the world where the outlook is less optimistic and how lower oil prices will impact other areas of the market. External risks to the domestic economy and stock market include a continued slowdown in China, a Russian recession negatively impacting Eurozone growth, implications of a stronger U.S. dollar, and the continuously evolving geopolitical landscape. Domestically, the most notable risk is the timing and pace of the Fed’s tightening policy. We think the Fed likely will exercise patience in raising rates with inflation and wage growth almost nonexistent and concerns about slowing global growth and the implications that a stronger U.S. dollar and lower energy prices may have on global markets. While most foreign central banks continue to employ accommodative monetary policy, the recent strength of the U.S. dollar has a tightening influence, partially offsetting the impact of the accommodative decisions, on those economies whose currencies are tied to the U.S. dollar. We anticipate that a slowdown globally could weigh on domestic growth and influence the Fed’s decision on rates.
As the current bull market that began in March of 2009 continues, we are concerned about potential investor complacency. While volatility picked up in the fourth quarter of 2014, it continues to remain near historic lows. Given the rapid decline in energy prices and continued speculation about how and when the Fed will tighten, we believe that the abnormally low levels of volatility that have accompanied such a strong market for the last six years will moderate. We believe increased volatility would benefit our investment style as higher quality stocks typically outperform lower quality stocks in these environments. As always, our focus remains on identifying quality companies at discount prices and corporate transformation opportunities, and we continue to find good ideas across sectors. Given our investment approach, we believe the Funds are well-suited to withstand a variety of market scenarios and add value over the long-term.
December 31, 2014 | William Blair Funds | 7 |
8 | Annual Report | December 31, 2014 |
Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | 6.59 | % | 18.51 | % | 13.24 | % | 8.46 | % | ||||||||
Class I | 6.96 | 18.90 | 13.60 | 8.81 | ||||||||||||
Russell 3000® Growth Index | 12.44 | 20.25 | 15.89 | 8.50 | ||||||||||||
S&P 500 Index | 13.69 | 20.41 | 15.45 | 7.67 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company L.L.C. without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell 3000® Growth Index consists of large, medium, and small capitalization companies with above average price-to-book ratios and forecasted growth rates. The index is weighted by market capitalization and large/medium/small companies make up approximately 80%/15%/5% of the index.
The S&P 500 Index indicates broad larger capitalization equity market performance.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 9 |
Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Information Technology—29.8% | |||||||||
* | Akamai Technologies, Inc. | 364,000 | $ | 22,917 | |||||
ARM Holdings plc—ADR | 217,200 | 10,056 | |||||||
* | Cognizant Technology Solutions Corporation | 329,600 | 17,357 | ||||||
* | CoStar Group, Inc. | 58,957 | 10,826 | ||||||
* | Google, Inc. - Class A | 51,980 | 27,584 | ||||||
* | Google, Inc. - Class C | 48,205 | 25,375 | ||||||
* | Guidewire Software, Inc. | 180,900 | 9,159 | ||||||
* | IPG Photonics Corporation | 140,200 | 10,504 | ||||||
Mastercard, Inc. | 584,700 | 50,378 | |||||||
* | NeuStar, Inc. | 247,000 | 6,867 | ||||||
* | Pandora Media, Inc. | 632,583 | 11,279 | ||||||
QUALCOMM, Inc. | 216,440 | 16,088 | |||||||
* | Red Hat, Inc. | 337,006 | 23,301 | ||||||
Solera Holdings, Inc. | 168,502 | 8,624 | |||||||
* | Trimble Navigation, Ltd. | 420,439 | 11,158 | ||||||
* | Vantiv, Inc. | 538,200 | 18,256 | ||||||
* | Verint Systems, Inc. | 120,600 | 7,028 | ||||||
286,757 | |||||||||
Industrials—18.0% | |||||||||
AMETEK, Inc. | 274,600 | 14,452 | |||||||
Equifax, Inc. | 265,100 | 21,439 | |||||||
* | Jacobs Engineering Group, Inc. | 222,356 | 9,937 | ||||||
Precision Castparts Corporation | 158,400 | 38,155 | |||||||
* | RPX Corporation | 379,900 | 5,235 | ||||||
* | Stericycle, Inc. | 245,500 | 32,180 | ||||||
Towers Watson & Co. | 130,000 | 14,712 | |||||||
TransDigm Group, Inc. | 57,380 | 11,267 | |||||||
* | TriMas Corporation | 222,337 | 6,957 | ||||||
* | Verisk Analytics, Inc. | 178,238 | 11,416 | ||||||
* | WageWorks, Inc. | 106,800 | 6,896 | ||||||
172,646 | |||||||||
Consumer Discretionary—17.9% | |||||||||
* | Amazon.com, Inc. | 86,800 | 26,939 | ||||||
BorgWarner, Inc. | 275,200 | 15,122 | |||||||
* | Fossil Group, Inc. | 89,300 | 9,889 | ||||||
Harley-Davidson, Inc. | 138,351 | 9,119 | |||||||
Lowe’s Cos., Inc. | 503,400 | 34,634 | |||||||
* | Lumber Liquidators Holdings, Inc. | 109,700 | 7,274 | ||||||
* | Sally Beauty Holdings, Inc. | 364,600 | 11,208 | ||||||
* | The Priceline Group, Inc. | 19,800 | 22,576 | ||||||
VF Corporation | 175,100 | 13,115 | |||||||
Williams-Sonoma, Inc. | 157,600 | 11,927 | |||||||
Yum! Brands, Inc. | 138,700 | 10,104 | |||||||
171,907 | |||||||||
Health Care—15.6% | |||||||||
Analogic Corporation | 109,676 | 9,279 | |||||||
* | BioMarin Pharmaceutical, Inc. | 85,000 | 7,684 | ||||||
Bristol-Myers Squibb Co. | 430,700 | 25,424 | |||||||
* | Catamaran Corporation† | 302,900 | 15,675 | ||||||
* | Exact Sciences Corporation | 186,000 | 5,104 | ||||||
* | Gilead Sciences, Inc. | 287,470 | 27,097 | ||||||
* | HMS Holdings Corporation | 347,669 | 7,350 | ||||||
* | IDEXX Laboratories, Inc. | 76,300 | 11,313 | ||||||
* | Medivation, Inc. | 80,572 | 8,026 |
Issuer | Shares or Principal Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Health Care—(continued) | |||||||||
* | NxStage Medical, Inc. | 420,677 | $ | 7,543 | |||||
Perrigo Co. plc† | 115,158 | 19,250 | |||||||
* | Spectranetics Corporation | 170,700 | 5,903 | ||||||
149,648 | |||||||||
Consumer Staples—8.6% | |||||||||
Colgate-Palmolive Co. | 343,600 | 23,774 | |||||||
Costco Wholesale Corporation | 174,300 | 24,707 | |||||||
Keurig Green Mountain, Inc. | 111,100 | 14,709 | |||||||
Mead Johnson Nutrition Co. | 198,300 | 19,937 | |||||||
83,127 | |||||||||
Financials—4.8% | |||||||||
* | Encore Capital Group, Inc. | 309,021 | 13,721 | ||||||
Intercontinental Exchange, Inc. | 51,900 | 11,381 | |||||||
LPL Financial Holdings, Inc. | 289,491 | 12,897 | |||||||
* | Texas Capital Bancshares, Inc. | 152,500 | 8,285 | ||||||
46,284 | |||||||||
Energy—4.4% | |||||||||
Noble Energy, Inc. | 150,400 | 7,133 | |||||||
Pioneer Natural Resources Co. | 47,200 | 7,026 | |||||||
Schlumberger, Ltd.† | 220,800 | 18,859 | |||||||
Suncor Energy, Inc.† | 286,200 | 9,095 | |||||||
42,113 | |||||||||
Total Common Stocks—99.1% (cost $772,112) | 952,482 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $11,507, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 11,507 | 11,507 | ||||||
Total Repurchase Agreement—1.2% (cost $11,507) | 11,507 | ||||||||
Total Investments—100.3% (cost $783,619) | 963,989 | ||||||||
Liabilities, plus cash and other assets—(0.3)% | (3,186 | ) | |||||||
Net assets—100.0% | $ | 960,803 |
ADR = American Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
See accompanying Notes to Financial Statements.
10 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 11 |
Large Cap Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | 14.29 | % | 21.61 | % | 14.97 | % | 7.09 | % | ||||||||
Class I | 14.65 | 21.97 | 15.22 | 7.34 | ||||||||||||
Russell 1000® Growth Index | 13.05 | 20.26 | 15.81 | 8.49 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell 1000® Growth Index consists of large capitalization companies with above average price-to-book ratios and forecasted growth rates.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
12 | Annual Report | December 31, 2014 |
Large Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Information Technology—32.4% | |||||||||
* | Adobe Systems, Inc. | 13,990 | $ | 1,017 | |||||
* | Akamai Technologies, Inc. | 16,550 | 1,042 | ||||||
Apple, Inc. | 40,365 | 4,455 | |||||||
* | Cognizant Technology Solutions Corporation | 33,540 | 1,766 | ||||||
* | Facebook, Inc. | 16,550 | 1,291 | ||||||
* | Gartner, Inc. | 17,530 | 1,476 | ||||||
* | Google, Inc. - Class A | 2,400 | 1,274 | ||||||
* | Google, Inc. - Class C | 2,400 | 1,263 | ||||||
Mastercard, Inc. | 28,420 | 2,449 | |||||||
* | Red Hat, Inc. | 26,190 | 1,811 | ||||||
Texas Instruments, Inc. | 27,770 | 1,485 | |||||||
19,329 | |||||||||
Consumer Discretionary—19.1% | |||||||||
* | Amazon.com, Inc. | 4,670 | 1,449 | ||||||
BorgWarner, Inc. | 21,070 | 1,158 | |||||||
* | Dollar General Corporation | 21,180 | 1,498 | ||||||
* | O’Reilly Automotive, Inc. | 10,450 | 2,013 | ||||||
Starbucks Corporation | 12,630 | 1,036 | |||||||
The Home Depot, Inc. | 28,420 | 2,983 | |||||||
* | The Priceline Group, Inc. | 1,094 | 1,247 | ||||||
11,384 | |||||||||
Industrials—13.5% | |||||||||
Equifax, Inc. | 22,760 | 1,841 | |||||||
Precision Castparts Corporation | 6,940 | 1,672 | |||||||
* | Stericycle, Inc. | 11,810 | 1,548 | ||||||
TransDigm Group, Inc. | 6,320 | 1,241 | |||||||
Union Pacific Corporation | 14,750 | 1,757 | |||||||
8,059 | |||||||||
Health Care—11.8% | |||||||||
Bristol-Myers Squibb Co. | 26,240 | 1,549 | |||||||
* | Gilead Sciences, Inc. | 24,880 | 2,345 | ||||||
* | IDEXX Laboratories, Inc. | 11,160 | 1,655 | ||||||
Zoetis, Inc. | 34,300 | 1,476 | |||||||
7,025 | |||||||||
Consumer Staples—9.5% | |||||||||
Colgate-Palmolive Co. | 17,200 | 1,190 | |||||||
Keurig Green Mountain, Inc. | 12,600 | 1,668 | |||||||
Mead Johnson Nutrition Co. | 12,360 | 1,243 | |||||||
* | Monster Beverage Corporation | 5,720 | 620 | ||||||
The Estee Lauder Cos., Inc. | 11,920 | 908 | |||||||
5,629 | |||||||||
Financials—6.3% | |||||||||
* | Affiliated Managers Group, Inc. | 9,530 | 2,023 | ||||||
Citigroup, Inc. | 32,070 | 1,735 | |||||||
3,758 |
Issuer | Shares or Principal Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Energy—3.7% | |||||||||
Noble Energy, Inc. | 12,900 | $ | 612 | ||||||
Schlumberger, Ltd.† | 18,810 | 1,606 | |||||||
2,218 | |||||||||
Telecommunication Services—2.7% | |||||||||
* | SBA Communications Corporation | 14,320 | 1,586 | ||||||
Total Common Stocks—99.0% (cost $45,706) | 58,988 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $614, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 614 | 614 | ||||||
Total Repurchase Agreement—1.0% (cost $614) | 614 | ||||||||
Total Investments—100.0% (cost $46,320) | 59,602 | ||||||||
Cash and other assets, less liabilities—0.0% | 7 | ||||||||
Net assets—100.0% | $ | 59,609 |
* Non-income producing securities
† = U.S. listed foreign security
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 13 |
The Large Cap Value Fund seeks long-term capital appreciation.
| |
David F. Hone
| The William Blair Large Cap Value Fund (Class N shares) posted a 8.35% increase, net of fees, for the twelve months ended December 31, 2014. By comparison, the Fund’s benchmark index, the Russell 1000® Value Index (the “Index”), increased 13.45%.
The Fund’s underperformance relative to the Index was primarily driven by stock selection. At the sector level, the largest detractors from relative performance were Financials, Health Care, Telecom Services, and Industrials; each having a similar impact on overall portfolio performance. Within Financials, negative contributions from REITs, Commercial Banks and Diversified Financial Services outweighed positive contributions from the other industries. The Fund’s lack of exposure to Airlines was a meaningful detractor from relative performance within Industrials and disappointing stock selection within Pharmaceuticals detracted from Health Care performance. Technology was the most significant sector contributor to relative performance as an overweight versus the Index to the best performing sector of the market resulted in a positive allocation effect; it was somewhat offset by negative stock selection within the sector. Looking specifically at stock selection, our largest detractors from relative performance were Sprint (Telecommunications), Owens-Illinois (Materials), and Southwestern Energy (Energy). Offsetting these were contributions from investments in Burlington Stores (Consumer Discretionary), Alcoa (Materials), and UnitedHealth Group (Health Care).
Please refer to the U.S. Value Market Review and Outlook provided for this Fund on page 7. |
14 | Annual Report | December 31, 2014 |
Large Cap Value Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014
1 Year | 3 Year | Since Inception(a) | ||||||||||
Class N | 8.35 | % | 19.06 | % | 17.77 | % | ||||||
Class I | 8.65 | 19.37 | 18.05 | |||||||||
Russell 1000® Value Index | 13.45 | 20.89 | 20.16 |
(a) | For the period from October 24, 2011 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell 1000® Value Index consists of large capitalization companies with above average price-to-book ratios and forecasted growth rates.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 15 |
Large Cap Value Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Financials—28.8% | |||||||||
American International Group, Inc. | 1,674 | $ | 94 | ||||||
American Tower Corporation | 741 | 73 | |||||||
Bank of America Corporation | 9,192 | 164 | |||||||
* | CBRE Group, Inc. | 1,760 | 60 | ||||||
Citigroup, Inc. | 2,889 | 156 | |||||||
Citizens Financial Group, Inc. | 1,187 | 30 | |||||||
CNA Financial Corporation | 1,257 | 49 | |||||||
Discover Financial Services | 1,029 | 67 | |||||||
Lazard, Ltd.† | 989 | 50 | |||||||
Lincoln National Corporation | 1,703 | 98 | |||||||
Morgan Stanley | 2,455 | 95 | |||||||
Regions Financial Corporation | 9,187 | 97 | |||||||
State Street Corporation | 1,067 | 84 | |||||||
SunTrust Banks, Inc. | 2,059 | 86 | |||||||
Ventas, Inc. | 524 | 38 | |||||||
Zions Bancorporation | 3,143 | 90 | |||||||
1,331 | |||||||||
Information Technology—13.5% | |||||||||
Broadcom Corporation | 1,380 | 60 | |||||||
Cisco Systems, Inc. | 4,503 | 125 | |||||||
* | Citrix Systems, Inc. | 920 | 59 | ||||||
Corning, Inc. | 2,239 | 51 | |||||||
Hewlett-Packard Co. | 2,256 | 91 | |||||||
International Business Machines Corporation | 146 | 23 | |||||||
Microsoft Corporation | 2,030 | 94 | |||||||
NetApp, Inc. | 568 | 24 | |||||||
* | Teradata Corporation | 1,026 | 45 | ||||||
* | VeriFone Systems, Inc. | 1,408 | 52 | ||||||
624 | |||||||||
Health Care—13.2% | |||||||||
Baxter International, Inc. | 751 | 55 | |||||||
* | Boston Scientific Corporation | 4,170 | 55 | ||||||
Cardinal Health, Inc. | 865 | 70 | |||||||
* | Express Scripts Holding Co. | 764 | 65 | ||||||
Merck & Co., Inc. | 2,088 | 118 | |||||||
PerkinElmer, Inc. | 1,027 | 45 | |||||||
UnitedHealth Group, Inc. | 1,296 | 131 | |||||||
Zimmer Holdings, Inc. | 609 | 69 | |||||||
608 | |||||||||
Energy—10.4% | |||||||||
Anadarko Petroleum Corporation | 763 | 63 | |||||||
Baker Hughes, Inc. | 840 | 47 | |||||||
Chevron Corporation | 1,228 | 138 | |||||||
Devon Energy Corporation | 677 | 41 | |||||||
Diamond Offshore Drilling, Inc. | 749 | 28 | |||||||
Exxon Mobil Corporation | 1,343 | 124 | |||||||
* | Southwestern Energy Co. | 1,391 | 38 | ||||||
479 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Industrials—10.0% | |||||||||
Kansas City Southern | 386 | $ | 47 | ||||||
* | Navistar International Corporation | 1,588 | 53 | ||||||
SPX Corporation | 507 | 43 | |||||||
Textron, Inc. | 2,091 | 88 | |||||||
The Boeing Co. | 226 | 29 | |||||||
The Manitowoc Co., Inc. | 2,111 | 47 | |||||||
Union Pacific Corporation | 410 | 49 | |||||||
United Technologies Corporation | 918 | 106 | |||||||
462 | |||||||||
Consumer Staples—7.2% | |||||||||
General Mills, Inc. | 1,146 | 61 | |||||||
Philip Morris International, Inc. | 1,125 | 92 | |||||||
The Procter & Gamble Co. | 1,095 | 100 | |||||||
Walgreens Boots Alliance, Inc. | 1,076 | 82 | |||||||
335 | |||||||||
Consumer Discretionary—7.2% | |||||||||
Big Lots, Inc. | 763 | 31 | |||||||
Brunswick Corporation | 1,419 | 73 | |||||||
* | Burlington Stores, Inc. | 1,260 | 60 | ||||||
Delphi Automotive plc† | 667 | 48 | |||||||
General Motors Co. | 1,416 | 49 | |||||||
Kohl’s Corporation | 647 | 39 | |||||||
* | MGM Resorts International | 1,489 | 32 | ||||||
332 | |||||||||
Utilities—4.8% | |||||||||
CMS Energy Corporation | 1,607 | 56 | |||||||
NextEra Energy, Inc. | 890 | 94 | |||||||
Wisconsin Energy Corporation | 1,320 | 70 | |||||||
220 | |||||||||
Materials—3.0% | |||||||||
Alcoa, Inc. | 3,399 | 54 | |||||||
* | Owens-Illinois, Inc. | 2,114 | 57 | ||||||
Rockwood Holdings, Inc. | 375 | 29 | |||||||
140 | |||||||||
Telecommunication Services—1.3% | |||||||||
* | Sprint Corporation | 6,055 | 25 | ||||||
Verizon Communications, Inc. | 757 | 36 | |||||||
61 | |||||||||
Total Common Stocks—99.4% (cost $3,634) | 4,592 | ||||||||
Total Investments—99.4% (cost $3,634) | 4,592 | ||||||||
Cash and other assets, less liabilities—0.6% | 29 | ||||||||
Net assets—100.0% | $ | 4,621 |
* Non-income producing securities
† = U.S. listed foreign security
See accompanying Notes to Financial Statements.
16 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 17 |
Mid Cap Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | Since Inception(a) | |||||||||||||
Class N | 7.53 | % | 15.37 | % | 14.12 | % | 8.45 | % | ||||||||
Class I | 7.87 | 15.71 | 14.43 | 8.75 | ||||||||||||
Russell Midcap® Growth Index | 11.90 | 20.71 | 16.94 | 8.50 |
(a) | For the period from February 1, 2006 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in medium capitalization companies involves special risks, including higher volatility and lower liquidity. Medium Capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell Midcap® Growth Index is an index that is constructed to provide a comprehensive and unbiased barometer of the mid-cap growth market.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
18 | Annual Report | December 31, 2014 |
Mid Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Consumer Discretionary—19.9% | |||||||||
BorgWarner, Inc. | 125,343 | $ | 6,888 | ||||||
* | Dollar General Corporation | 130,665 | 9,238 | ||||||
L Brands, Inc. | 49,970 | 4,325 | |||||||
Marriott International, Inc. | 84,599 | 6,601 | |||||||
* | Michael Kors Holdings, Ltd.† | 45,660 | 3,429 | ||||||
* | O’Reilly Automotive, Inc. | 52,980 | 10,205 | ||||||
Polaris Industries, Inc. | 48,130 | 7,279 | |||||||
Ross Stores, Inc. | 67,300 | 6,344 | |||||||
Six Flags Entertainment Corporation | 102,780 | 4,435 | |||||||
Williams-Sonoma, Inc. | 118,827 | 8,993 | |||||||
67,737 | |||||||||
Industrials—19.1% | |||||||||
AMETEK, Inc. | 127,360 | 6,703 | |||||||
Equifax, Inc. | 111,100 | 8,985 | |||||||
Fortune Brands Home & Security, Inc. | 123,250 | 5,579 | |||||||
Manpowergroup, Inc. | 53,730 | 3,663 | |||||||
* | Old Dominion Freight Line, Inc. | 101,850 | 7,908 | ||||||
Rockwell Collins, Inc. | 39,970 | 3,377 | |||||||
* | Stericycle, Inc. | 82,140 | 10,767 | ||||||
* | The Middleby Corporation | 39,970 | 3,961 | ||||||
Towers Watson & Co. | 34,290 | 3,880 | |||||||
TransDigm Group, Inc. | 17,100 | 3,357 | |||||||
* | Verisk Analytics, Inc. | 104,980 | 6,724 | ||||||
64,904 | |||||||||
Information Technology—17.1% | |||||||||
* | Akamai Technologies, Inc. | 108,168 | 6,810 | ||||||
* | CoStar Group, Inc. | 28,377 | 5,211 | ||||||
* | Gartner, Inc. | 101,729 | 8,567 | ||||||
* | Genpact, Ltd.† | 265,252 | 5,021 | ||||||
* | Guidewire Software, Inc. | 124,220 | 6,289 | ||||||
* | IPG Photonics Corporation | 51,920 | 3,890 | ||||||
* | NeuStar, Inc. | 131,590 | 3,658 | ||||||
* | Pandora Media, Inc. | 169,150 | 3,016 | ||||||
* | Red Hat, Inc. | 83,930 | 5,803 | ||||||
* | Vantiv, Inc. | 287,406 | 9,749 | ||||||
58,014 | |||||||||
Health Care—15.9% | |||||||||
* | Align Technology, Inc. | 79,580 | 4,449 | ||||||
Bio-Techne Corporation | 36,755 | 3,396 | |||||||
* | BioMarin Pharmaceutical, Inc. | 84,242 | 7,616 | ||||||
* | HMS Holdings Corporation | 259,941 | 5,495 | ||||||
* | IDEXX Laboratories, Inc. | 29,590 | 4,387 | ||||||
* | Mallinckrodt plc† | 39,970 | 3,958 | ||||||
* | Medivation, Inc. | 40,160 | 4,001 | ||||||
* | Mednax, Inc. | 97,460 | 6,443 | ||||||
* | Mettler-Toledo International, Inc. | 11,720 | 3,545 | ||||||
* | Sirona Dental Systems, Inc. | 63,210 | 5,523 | ||||||
Zoetis, Inc. | 119,830 | 5,156 | |||||||
53,969 |
Issuer | Shares or Principal Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Consumer Staples—9.4% | |||||||||
Church & Dwight Co., Inc. | 70,480 | $ | 5,555 | ||||||
Keurig Green Mountain, Inc. | 43,800 | 5,799 | |||||||
Mead Johnson Nutrition Co. | 81,400 | 8,184 | |||||||
* | Monster Beverage Corporation | 59,410 | 6,437 | ||||||
* | Sprouts Farmers Market, Inc. | 179,432 | 6,097 | ||||||
32,072 | |||||||||
Financials—8.1% | |||||||||
* | Affiliated Managers Group, Inc. | 52,855 | 11,218 | ||||||
LPL Financial Holdings, Inc. | 131,891 | 5,876 | |||||||
* | PRA Group, Inc. | 84,260 | 4,881 | ||||||
* | Signature Bank | 44,420 | 5,595 | ||||||
27,570 | |||||||||
Energy—3.7% | |||||||||
* | Concho Resources, Inc. | 31,720 | 3,164 | ||||||
* | FMC Technologies, Inc. | 64,439 | 3,018 | ||||||
Pioneer Natural Resources Co. | 18,250 | 2,717 | |||||||
Range Resources Corporation | 48,790 | 2,608 | |||||||
* | Whiting Petroleum Corporation | 33,680 | 1,111 | ||||||
12,618 | |||||||||
Telecommunication Services—2.5% | |||||||||
* | SBA Communications Corporation | 76,050 | 8,423 | ||||||
Materials—1.1% | |||||||||
International Flavors & Fragrances, Inc. | 36,201 | 3,669 | |||||||
Total Common Stocks—96.8% (cost $285,462) | 328,976 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $11,683, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 11,683 | 11,683 | ||||||
Total Repurchase Agreement—3.5% (cost $11,683) | 11,683 | ||||||||
Total Investments—100.3% (cost $297,145) | 340,659 | ||||||||
Liabilities, plus cash and other assets—(0.3)% | (873 | ) | |||||||
Net assets—100.0% | $ | 339,786 |
* Non-income producing securities
† = U.S. listed foreign security
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 19 |
20 | Annual Report | December 31, 2014 |
Mid Cap Value Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014
Since | ||||||||||||
1 Year | 3 Year | Inception(a) | ||||||||||
Class N | 10.83 | % | 18.27 | % | 13.23 | % | ||||||
Class I | 11.04 | 18.53 | 13.48 | |||||||||
Russell Midcap® Value Index | 14.75 | 21.98 | 14.98 |
(a) | For the period from May 3, 2010 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in smaller and medium capitalization companies involves special risks, including higher volatility and lower liquidity. Medium Capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell Midcap® Value Index consists of midcap-capitalization companies with below average price-to-book ratios and forecasted growth rates.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 21 |
Mid Cap Value Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Financials—32.9% | |||||||||
Allied World Assurance Co. Holdings, Ltd.† | 1,135 | $ | 43 | ||||||
American Campus Communities, Inc. | 1,180 | 49 | |||||||
Ameriprise Financial, Inc. | 653 | 86 | |||||||
Assured Guaranty, Ltd.† | 1,430 | 37 | |||||||
AvalonBay Communities, Inc. | 305 | 50 | |||||||
DDR Corporation | 1,965 | 36 | |||||||
* | E*TRADE Financial Corporation | 1,290 | 31 | ||||||
East West Bancorp, Inc. | 1,340 | 52 | |||||||
Essex Property Trust, Inc. | 145 | 30 | |||||||
FNF Group | 1,120 | 39 | |||||||
* | Forest City Enterprises, Inc. | 1,935 | 41 | ||||||
General Growth Properties, Inc. | 1,645 | 46 | |||||||
Hanover Insurance Group, Inc. | 845 | 60 | |||||||
Hartford Financial Services Group, Inc. | 2,070 | 86 | |||||||
Host Hotels & Resorts, Inc. | 2,185 | 52 | |||||||
Jones Lang LaSalle, Inc. | 372 | 56 | |||||||
Northern Trust Corporation | 735 | 50 | |||||||
Prologis, Inc. | 895 | 38 | |||||||
Regions Financial Corporation | 5,315 | 56 | |||||||
* | Signature Bank | 227 | 29 | ||||||
SL Green Realty Corporation | 563 | 67 | |||||||
SunTrust Banks, Inc. | 1,725 | 72 | |||||||
Taubman Centers, Inc. | 435 | 33 | |||||||
Validus Holdings, Ltd.† | 1,195 | 50 | |||||||
Ventas, Inc. | 720 | 52 | |||||||
1,241 | |||||||||
Utilities—12.8% | |||||||||
American Water Works Co., Inc. | 1,050 | 56 | |||||||
CMS Energy Corporation | 1,760 | 61 | |||||||
DTE Energy Co. | 695 | 60 | |||||||
Northeast Utilities | 1,225 | 65 | |||||||
Pinnacle West Capital Corporation | 715 | 49 | |||||||
Sempra Energy | 519 | 58 | |||||||
Wisconsin Energy Corporation | 1,200 | 63 | |||||||
Xcel Energy, Inc. | 1,890 | 68 | |||||||
480 | |||||||||
Information Technology—12.0% | |||||||||
* | Akamai Technologies, Inc. | 960 | 60 | ||||||
* | Atmel Corporation | 6,290 | 53 | ||||||
Belden, Inc. | 620 | 49 | |||||||
* | Cadence Design Systems, Inc. | 3,205 | 61 | ||||||
* | CommScope Holding Co., Inc. | 2,135 | 49 | ||||||
* | Genpact, Ltd.† | 2,075 | 39 | ||||||
Juniper Networks, Inc. | 2,175 | 49 | |||||||
* | PTC, Inc. | 960 | 35 | ||||||
TE Connectivity, Ltd.† | 885 | 56 | |||||||
451 | |||||||||
Consumer Discretionary—9.9% | |||||||||
Autoliv, Inc. | 372 | 39 | |||||||
Darden Restaurants, Inc. | 655 | 38 | |||||||
H&R Block, Inc. | 1,235 | 42 | |||||||
Kohl’s Corporation | 610 | 37 | |||||||
Lennar Corporation | 1,160 | 52 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Consumer Discretionary—(continued) | |||||||||
Macy’s, Inc. | 745 | $ | 49 | ||||||
Newell Rubbermaid, Inc. | 1,600 | 61 | |||||||
VF Corporation | 705 | 53 | |||||||
371 | |||||||||
Industrials—9.8% | |||||||||
Carlisle Companies, Inc. | 615 | 56 | |||||||
Curtiss-Wright Corporation | 535 | 38 | |||||||
Donaldson Co., Inc. | 1,244 | 48 | |||||||
EMCOR Group, Inc. | 760 | 34 | |||||||
Hubbell, Inc. | 357 | 38 | |||||||
Pall Corporation | 695 | 70 | |||||||
Towers Watson & Co. | 418 | 47 | |||||||
W.W. Grainger, Inc. | 149 | 38 | |||||||
369 | |||||||||
Health Care—8.9% | |||||||||
CIGNA Corporation | 915 | 94 | |||||||
* | Mednax, Inc. | 735 | 49 | ||||||
* | Mettler-Toledo International, Inc. | 190 | 57 | ||||||
Omnicare, Inc. | 865 | 63 | |||||||
Zimmer Holdings, Inc. | 650 | 74 | |||||||
337 | |||||||||
Materials—5.0% | |||||||||
Airgas, Inc. | 385 | 44 | |||||||
Carpenter Technology Corporation | 925 | 46 | |||||||
FMC Corporation | 770 | 44 | |||||||
Steel Dynamics, Inc. | 2,680 | 53 | |||||||
187 | |||||||||
Consumer Staples—4.2% | |||||||||
ConAgra Foods, Inc. | 1,125 | 41 | |||||||
Ingredion, Inc. | 645 | 55 | |||||||
The Kroger Co. | 1,005 | 64 | |||||||
160 | |||||||||
Energy—3.2% | |||||||||
* | Cameron International Corporation | 395 | 20 | ||||||
* | Gulfport Energy Corporation | 370 | 15 | ||||||
Noble Energy, Inc. | 595 | 28 | |||||||
Pioneer Natural Resources Co. | 126 | 19 | |||||||
Rowan Cos. plc† | 840 | 20 | |||||||
*Whiting Petroleum Corporation | 605 | 20 | |||||||
122 | |||||||||
Total Common Stocks—98.7% (cost $2,639) | 3,718 | ||||||||
Total Investments—98.7% (cost $2,639) | 3,718 | ||||||||
Cash and other assets, less liabilities—1.3% | 50 | ||||||||
Net assets—100.0% | $ | 3,768 |
† = U.S. listed foreign security
* Non-income producing securities
See accompanying Notes to Financial Statements.
22 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 23 |
Small-Mid Cap Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | 8.33 | % | 19.81 | % | 16.06 | % | 9.91 | % | ||||||||
Class I | 8.62 | 20.08 | 16.34 | 10.19 | ||||||||||||
Russell 2500™ Growth Index | 7.05 | 20.47 | 17.27 | 9.37 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in smaller and medium capitalization companies involves special risks, including higher volatility and lower liquidity. Smaller and medium capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell 2500TM Growth Index measures the performance of those Russell 2500 companies with above average price-to-book ratios and forecasted growth rates.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
24 | Annual Report | December 31, 2014 |
Small-Mid Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Health Care—25.3% | |||||||||
* | ABIOMED, Inc. | 250,038 | $ | 9,516 | |||||
* | Akorn, Inc. | 278,909 | 10,097 | ||||||
* | Align Technology, Inc. | 213,703 | 11,948 | ||||||
Bio-Techne Corporation | 123,100 | 11,374 | |||||||
* | BioMarin Pharmaceutical, Inc. | 182,500 | 16,498 | ||||||
* | Brookdale Senior Living, Inc. | 308,276 | 11,305 | ||||||
* | Catamaran Corporation† | 186,432 | 9,648 | ||||||
* | Cyberonics, Inc. | 128,314 | 7,145 | ||||||
* | Exact Sciences Corporation | 405,175 | 11,118 | ||||||
* | ExamWorks Group, Inc. | 176,131 | 7,325 | ||||||
HealthSouth Corporation | 397,884 | 15,303 | |||||||
* | IDEXX Laboratories, Inc. | 83,911 | 12,442 | ||||||
* | Ligand Pharmaceuticals, Inc. | 163,715 | 8,711 | ||||||
* | Medivation, Inc. | 94,252 | 9,388 | ||||||
* | Mednax, Inc. | 234,200 | 15,483 | ||||||
* | Mettler-Toledo International, Inc. | 50,600 | 15,304 | ||||||
* | Quintiles Transnational Holdings, Inc. | 218,900 | 12,887 | ||||||
* | Sirona Dental Systems, Inc. | 185,753 | 16,229 | ||||||
* | Team Health Holdings, Inc. | 170,128 | 9,787 | ||||||
221,508 | |||||||||
Industrials—20.8% | |||||||||
ABM Industries, Inc. | 297,130 | 8,513 | |||||||
* | B/E Aerospace, Inc. | 125,053 | 7,256 | ||||||
Fortune Brands Home & Security, Inc. | 205,800 | 9,316 | |||||||
Graco, Inc. | 80,967 | 6,492 | |||||||
Healthcare Services Group, Inc. | 280,532 | 8,677 | |||||||
* | Hexcel Corporation | 246,800 | 10,240 | ||||||
* | ICF International, Inc. | 344,193 | 14,105 | ||||||
* | KLX, Inc. | 62,527 | 2,579 | ||||||
Manpowergroup, Inc. | 96,950 | 6,609 | |||||||
* | Old Dominion Freight Line, Inc. | 136,771 | 10,619 | ||||||
Robert Half International, Inc. | 335,700 | 19,598 | |||||||
* | Stericycle, Inc. | 166,470 | 21,821 | ||||||
The Corporate Executive Board Co. | 137,128 | 9,946 | |||||||
* | The Middleby Corporation | 102,172 | 10,125 | ||||||
The Toro Co. | 124,900 | 7,970 | |||||||
Towers Watson & Co. | 102,400 | 11,589 | |||||||
TransDigm Group, Inc. | 43,475 | 8,536 | |||||||
* | TriMas Corporation | 274,623 | 8,593 | ||||||
182,584 | |||||||||
Information Technology—17.2% | |||||||||
* | Akamai Technologies, Inc. | 221,106 | 13,921 | ||||||
* | ANSYS, Inc. | 124,000 | 10,168 | ||||||
Booz Allen Hamilton Holding Corporation | 392,068 | 10,401 | |||||||
* | CoStar Group, Inc. | 74,110 | 13,609 | ||||||
FactSet Research Systems, Inc. | 79,100 | 11,133 | |||||||
* | Gartner, Inc. | 142,700 | 12,017 | ||||||
* | Guidewire Software, Inc. | 362,134 | 18,335 | ||||||
j2 Global, Inc. | 415,985 | 25,791 | |||||||
* | NeuStar, Inc. | 210,021 | 5,839 | ||||||
* | Pandora Media, Inc. | 407,634 | 7,268 | ||||||
* | Vantiv, Inc. | 409,400 | 13,887 | ||||||
* | WNS Holdings, Ltd.—ADR | 402,420 | 8,314 | ||||||
150,683 |
Shares or | |||||||||
Principal | |||||||||
Issuer | Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Financials—14.9% | |||||||||
* | Affiliated Managers Group, Inc. | 81,209 | $ | 17,236 | |||||
CBOE Holdings, Inc. | 249,100 | 15,798 | |||||||
* | Encore Capital Group, Inc. | 182,600 | 8,107 | ||||||
* | First Cash Financial Services, Inc. | 112,843 | 6,282 | ||||||
FirstService Corporation† | 178,520 | 9,080 | |||||||
FXCM, Inc. | 691,376 | 11,456 | |||||||
Jones Lang LaSalle, Inc. | 140,100 | 21,005 | |||||||
Lazard, Ltd.† | 155,700 | 7,790 | |||||||
LPL Financial Holdings, Inc. | 180,655 | 8,048 | |||||||
* | PRA Group, Inc. | 252,000 | 14,598 | ||||||
* | Signature Bank | 92,200 | 11,614 | ||||||
131,014 | |||||||||
Consumer Discretionary—12.1% | |||||||||
* | 2U, Inc. | 348,955 | 6,860 | ||||||
Choice Hotels International, Inc. | 177,536 | 9,945 | |||||||
* | Drew Industries, Inc. | 161,700 | 8,258 | ||||||
* | Jarden Corporation | 272,475 | 13,046 | ||||||
Polaris Industries, Inc. | 87,700 | 13,264 | |||||||
* | Sally Beauty Holdings, Inc. | 320,500 | 9,852 | ||||||
Six Flags Entertainment Corporation | 447,486 | 19,309 | |||||||
Tractor Supply Co. | 118,000 | 9,301 | |||||||
Williams-Sonoma, Inc. | 220,700 | 16,703 | |||||||
106,538 | |||||||||
Energy—3.2% | |||||||||
* | Carrizo Oil & Gas, Inc. | 125,100 | 5,204 | ||||||
* | Forum Energy Technologies, Inc. | 202,000 | 4,188 | ||||||
Frank’s International N.V.† | 349,934 | 5,819 | |||||||
* | Gulfport Energy Corporation | 102,300 | 4,270 | ||||||
Helmerich & Payne, Inc. | 53,832 | 3,629 | |||||||
Oceaneering International, Inc. | 80,200 | 4,717 | |||||||
27,827 | |||||||||
Materials—2.8% | |||||||||
Celanese Corporation | 194,200 | 11,644 | |||||||
International Flavors & Fragrances, Inc. | 126,900 | 12,863 | |||||||
24,507 | |||||||||
Telecommunication Services—1.9% | |||||||||
* | SBA Communications Corporation | 147,900 | 16,381 | ||||||
Consumer Staples—1.2% | |||||||||
Nu Skin Enterprises, Inc. | 236,800 | 10,348 | |||||||
Total Common Stocks—99.4% (cost $702,556) | 871,390 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $14,109, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 14,109 | 14,109 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 25 |
Small-Mid Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Value | |||
Total Repurchase Agreement—1.6% (cost $14,109) | $ | 14,109 | ||
Total Investments—101.0% (cost $716,665) | 885,499 | |||
Liabilities, plus cash and other assets—(1.0)% | (8,663 | ) | ||
Net assets—100.0% | $ | 876,836 |
ADR = American Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
See accompanying Notes to Financial Statements.
26 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 27 |
Small-Mid Cap Value Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||
1 Year | 3 Year | Since Inception(a) | ||||||||||
Class N | 4.66 | % | 16.89 | % | 18.31 | % | ||||||
Class I | 4.96 | 17.20 | 18.62 | |||||||||
Russell 2500™ Value Index | 7.11 | 19.40 | 20.70 |
(a) | For the period from December 15, 2011 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in smaller and medium capitalization companies involves special risks, including higher volatility and lower liquidity. Smaller and medium capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Russell 2500TM Value Index consists of midcap-capitalization companies with below average price-to-book ratios and forecasted growth rates.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
28 | Annual Report | December 31, 2014 |
Small-Mid Cap Value Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Financials—33.2% | |||||||||
Acadia Realty Trust | 1,090 | $ | 35 | ||||||
Allied World Assurance Co. Holdings, Ltd.† | 1,239 | 47 | |||||||
American Assets Trust, Inc. | 1,180 | 47 | |||||||
American Campus Communities, Inc. | 1,062 | 44 | |||||||
Assured Guaranty, Ltd.† | 1,817 | 47 | |||||||
Bank of the Ozarks, Inc. | 1,270 | 48 | |||||||
Boston Private Financial Holdings, Inc. | 3,060 | 41 | |||||||
CNO Financial Group, Inc. | 2,492 | 43 | |||||||
Douglas Emmett, Inc. | 1,506 | 43 | |||||||
* | E*TRADE Financial Corporation | 1,904 | 46 | ||||||
* | Eagle Bancorp, Inc. | 798 | 28 | ||||||
East West Bancorp, Inc. | 1,310 | 51 | |||||||
EastGroup Properties, Inc. | 496 | 31 | |||||||
EPR Properties | 567 | 33 | |||||||
Essex Property Trust, Inc. | 226 | 47 | |||||||
* | Forest City Enterprises, Inc. | 1,667 | 36 | ||||||
Glacier Bancorp, Inc. | 1,591 | 44 | |||||||
Hanover Insurance Group, Inc. | 635 | 45 | |||||||
Highwoods Properties, Inc. | 774 | 34 | |||||||
Home BancShares, Inc. | 1,468 | 47 | |||||||
Iberiabank Corporation | 622 | 40 | |||||||
Jones Lang LaSalle, Inc. | 345 | 52 | |||||||
LaSalle Hotel Properties | 1,099 | 45 | |||||||
PacWest Bancorp | 1,065 | 48 | |||||||
Pebblebrook Hotel Trust | 1,044 | 48 | |||||||
Radian Group, Inc. | 2,543 | 43 | |||||||
Renasant Corporation | 733 | 21 | |||||||
Selective Insurance Group, Inc. | 1,822 | 50 | |||||||
* | Signature Bank | 277 | 35 | ||||||
SL Green Realty Corporation | 373 | 44 | |||||||
Taubman Centers, Inc. | 554 | 42 | |||||||
Validus Holdings, Ltd.† | 1,156 | 48 | |||||||
* | Western Alliance Bancorp | 1,776 | 49 | ||||||
WSFS Financial Corporation | 570 | 44 | |||||||
1,446 | |||||||||
Industrials—14.8% | |||||||||
Barnes Group, Inc. | 1,069 | 40 | |||||||
Carlisle Companies, Inc. | 602 | 54 | |||||||
CIRCOR International, Inc. | 659 | 40 | |||||||
Curtiss-Wright Corporation | 590 | 42 | |||||||
Donaldson Co., Inc. | 1,276 | 49 | |||||||
EMCOR Group, Inc. | 830 | 37 | |||||||
* | Esterline Technologies Corporation | 369 | 40 | ||||||
G&K Services, Inc. | 707 | 50 | |||||||
* | Generac Holdings, Inc. | 661 | 31 | ||||||
Hubbell, Inc. | 342 | 37 | |||||||
Interface, Inc. | 1,647 | 27 | |||||||
* | Moog, Inc. | 584 | 43 | ||||||
Standex International Corporation | 275 | 21 | |||||||
* | Swift Transportation Co. | 1,312 | 38 | ||||||
The Toro Co. | 737 | 47 | |||||||
Towers Watson & Co. | 439 | 50 | |||||||
646 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Consumer Discretionary—13.6% | |||||||||
Autoliv, Inc. | 412 | $ | 44 | ||||||
Brunswick Corporation | 848 | 43 | |||||||
Children’s Place, Inc. | 574 | 33 | |||||||
Dana Holding Corporation | 1,217 | 26 | |||||||
Ethan Allen Interiors, Inc. | 1,090 | 34 | |||||||
* | Genesco, Inc. | 428 | 33 | ||||||
H&R Block, Inc. | 1,374 | 46 | |||||||
* | Krispy Kreme Doughnuts, Inc. | 2,971 | 59 | ||||||
Lennar Corporation | 1,058 | 47 | |||||||
Meredith Corporation | 722 | 39 | |||||||
Newell Rubbermaid, Inc. | 1,588 | 61 | |||||||
* | PEP Boys-Manny, Moe & Jack | 1,916 | 19 | ||||||
Ryland Group, Inc. | 877 | 34 | |||||||
Vail Resorts, Inc. | 435 | 40 | |||||||
Wolverine World Wide, Inc. | 1,161 | 34 | |||||||
592 | |||||||||
Information Technology—10.9% | |||||||||
* | Acxiom Corporation | 2,914 | 59 | ||||||
ADTRAN, Inc. | 1,406 | 31 | |||||||
* | Atmel Corporation | 5,077 | 43 | ||||||
Belden, Inc. | 637 | 50 | |||||||
Booz Allen Hamilton Holding Corporation | 864 | 23 | |||||||
* | Cadence Design Systems, Inc. | 3,143 | 60 | ||||||
EVERTEC, Inc.† | 1,767 | 39 | |||||||
* | Genpact, Ltd.† | 2,380 | 45 | ||||||
* | Inphi Corporation | 2,342 | 43 | ||||||
j2 Global, Inc. | 809 | 50 | |||||||
* | PTC, Inc. | 799 | 29 | ||||||
472 | |||||||||
Utilities—8.8% | |||||||||
ALLETE, Inc. | 773 | 43 | |||||||
American Water Works Co., Inc. | 997 | 53 | |||||||
CMS Energy Corporation | 1,672 | 58 | |||||||
Pinnacle West Capital Corporation | 681 | 46 | |||||||
PNM Resources, Inc. | 1,572 | 47 | |||||||
Portland General Electric Co. | 1,207 | 46 | |||||||
South Jersey Industries, Inc. | 715 | 42 | |||||||
Southwest Gas Corporation | 737 | 45 | |||||||
380 | |||||||||
Materials—6.3% | |||||||||
Airgas, Inc. | 193 | 22 | |||||||
Carpenter Technology Corporation | 465 | 23 | |||||||
FMC Corporation | 409 | 23 | |||||||
Minerals Technologies, Inc. | 664 | 46 | |||||||
PolyOne Corporation | 1,376 | 52 | |||||||
* | RTI International Metals, Inc. | 885 | 22 | ||||||
Sensient Technologies Corporation | 537 | 33 | |||||||
Silgan Holdings, Inc. | 419 | 23 | |||||||
Steel Dynamics, Inc. | 1,585 | 31 | |||||||
275 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 29 |
Small-Mid Cap Value Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares or Principal Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Health Care—6.0% | |||||||||
CONMED Corporation | 545 | $ | 25 | ||||||
* | Greatbatch, Inc. | 678 | 33 | ||||||
HealthSouth Corporation | 1,002 | 39 | |||||||
* | Magellan Health, Inc. | 374 | 23 | ||||||
* | Mednax, Inc. | 697 | 46 | ||||||
* | Mettler-Toledo International, Inc. | 169 | 52 | ||||||
Omnicare, Inc. | 636 | 46 | |||||||
264 | |||||||||
Energy—3.6% | |||||||||
* | Bonanza Creek Energy, Inc. | 698 | 17 | ||||||
Exterran Holdings, Inc. | 595 | 19 | |||||||
GasLog, Ltd.† | 396 | 8 | |||||||
* | Gulfport Energy Corporation | 288 | 12 | ||||||
* | Helix Energy Solutions Group, Inc. | 1,394 | 30 | ||||||
* | PDC Energy, Inc. | 463 | 19 | ||||||
* | Rosetta Resources, Inc. | 472 | 11 | ||||||
* | TETRA Technologies, Inc. | 3,629 | 24 | ||||||
* | Whiting Petroleum Corporation | 482 | 15 | ||||||
155 | |||||||||
Consumer Staples—2.5% | |||||||||
* | Darling Ingredients, Inc. | 1,379 | 25 | ||||||
Ingredion, Inc. | 598 | 51 | |||||||
J&J Snack Foods Corporation | 306 | 32 | |||||||
108 | |||||||||
Total Common Stocks—99.7% (cost $3,716) | 4,338 | ||||||||
Repurchase Agreement | |||||||||
State Street Bank and Trust Company, 0.010% dated 12/31/14, due 1/2/15, repurchase price $35, collateralized by FHLMC, 2.000% due 1/30/23 | $35 | 35 | |||||||
Total Repurchase Agreement—0.8% (cost $35) | 35 | ||||||||
Total Investments—100.5% (cost $3,751) | 4,373 | ||||||||
Liabilities, plus cash and other assets—(0.5)% | (20 | ) | |||||||
Net assets—100.0% | $ | 4,353 |
† = U.S. listed foreign security
* Non-income producing securities
See accompanying Notes to Financial Statements.
30 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 31 |
Small Cap Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | 2.62 | % | 22.81 | % | 13.28 | % | 6.62 | % | ||||||||
Class I | 2.87 | 23.10 | 13.58 | 6.91 | ||||||||||||
Russell 2000® Growth Index | 5.60 | 20.14 | 16.80 | 8.54 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in smaller companies involves special risks, including higher volatility and lower liquidity. Smaller Capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell 2000® Growth Index is an unmanaged composite of the smallest 2000 stocks of the Russell 3000® Growth Index.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
32 | Annual Report | December 31, 2014 |
Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Health Care—22.9% | |||||||||
* | ABIOMED, Inc. | 173,980 | $ | 6,622 | |||||
* | Addus HomeCare Corporation | 409,765 | 9,945 | ||||||
* | Air Methods Corporation | 145,166 | 6,392 | ||||||
* | Akorn, Inc. | 225,216 | 8,153 | ||||||
Analogic Corporation | 104,940 | 8,879 | |||||||
* | Cyberonics, Inc. | 102,720 | 5,719 | ||||||
* | Exact Sciences Corporation | 231,050 | 6,340 | ||||||
* | ExamWorks Group, Inc. | 126,531 | 5,262 | ||||||
HealthSouth Corporation | 182,755 | 7,029 | |||||||
* | Healthways, Inc. | 291,252 | 5,790 | ||||||
* | HMS Holdings Corporation | 309,400 | 6,541 | ||||||
LeMaitre Vascular, Inc. | 189,010 | 1,446 | |||||||
* | Ligand Pharmaceuticals, Inc. | 136,668 | 7,272 | ||||||
* | Nanosphere, Inc. | 3,302,494 | 1,295 | ||||||
* | NxStage Medical, Inc. | 345,498 | 6,195 | ||||||
* | Repligen Corporation | 169,070 | 3,347 | ||||||
* | Spectranetics Corporation | 269,907 | 9,333 | ||||||
Trinity Biotech plc—ADR | 346,814 | 6,073 | |||||||
* | Zeltiq Aesthetics, Inc. | 198,890 | 5,551 | ||||||
117,184 | |||||||||
Information Technology—22.2% | |||||||||
* | Callidus Software, Inc. | 252,970 | 4,131 | ||||||
* | CoStar Group, Inc. | 52,086 | 9,564 | ||||||
* | Exar Corporation | 1,005,114 | 10,252 | ||||||
* | Guidewire Software, Inc. | 120,560 | 6,104 | ||||||
* | Inphi Corporation | 340,670 | 6,295 | ||||||
j2 Global, Inc. | 203,827 | 12,637 | |||||||
* | MaxLinear, Inc. | 623,711 | 4,622 | ||||||
* | NeuStar, Inc. | 201,246 | 5,595 | ||||||
* | OSI Systems, Inc. | 84,691 | 5,994 | ||||||
* | Pandora Media, Inc. | 244,320 | 4,356 | ||||||
* | ServiceSource International, Inc. | 1,571,589 | 7,355 | ||||||
Solera Holdings, Inc. | 101,720 | 5,206 | |||||||
* | Tangoe, Inc. | 666,051 | 8,679 | ||||||
* | TeleTech Holdings, Inc. | 219,709 | 5,203 | ||||||
* | Ultimate Software Group, Inc. | 21,772 | 3,196 | ||||||
* | Verint Systems, Inc. | 123,530 | 7,199 | ||||||
* | WNS Holdings, Ltd.—ADR | 349,545 | 7,222 | ||||||
113,610 | |||||||||
Industrials—20.5% | |||||||||
ABM Industries, Inc. | 192,760 | 5,523 | |||||||
Acacia Research Corporation | 357,013 | 6,048 | |||||||
Barrett Business Services, Inc. | 181,869 | 4,983 | |||||||
* | CAI International, Inc. | 358,746 | 8,323 | ||||||
* | Enphase Energy, Inc. | 620,073 | 8,861 | ||||||
* | Franklin Covey Co. | 493,373 | 9,552 | ||||||
Healthcare Services Group, Inc. | 181,648 | 5,618 | |||||||
* | Hexcel Corporation | 123,990 | 5,144 | ||||||
* | Hudson Technologies, Inc. | 1,711,704 | 6,453 | ||||||
* | ICF International, Inc. | 217,924 | 8,930 | ||||||
John Bean Technologies Corporation | 170,230 | 5,594 | |||||||
* | On Assignment, Inc. | 175,435 | 5,823 | ||||||
* | RPX Corporation | 461,590 | 6,361 | ||||||
* | Sparton Corporation | 235,157 | 6,664 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Industrials—(continued) | |||||||||
* | TriMas Corporation | 257,525 | $ | 8,058 | |||||
US Ecology, Inc. | 74,525 | 2,990 | |||||||
104,925 | |||||||||
Consumer Discretionary—13.0% | |||||||||
Choice Hotels International, Inc. | 100,140 | 5,610 | |||||||
* | Gentherm, Inc. | 256,991 | 9,411 | ||||||
* | IMAX Corporation† | 232,520 | 7,185 | ||||||
* | Lumber Liquidators Holdings, Inc. | 96,570 | 6,403 | ||||||
MDC Partners, Inc.† | 212,638 | 4,831 | |||||||
Monro Muffler Brake, Inc. | 83,455 | 4,824 | |||||||
* | Scientific Games Corporation | 483,940 | 6,160 | ||||||
Six Flags Entertainment Corporation | 319,592 | 13,790 | |||||||
* | Tuesday Morning Corporation | 243,220 | 5,278 | ||||||
* | U.S. Auto Parts Network, Inc. | 1,437,420 | 3,364 | ||||||
66,856 | |||||||||
Financials—11.7% | |||||||||
* | Cowen Group, Inc. | 1,547,916 | 7,430 | ||||||
* | Encore Capital Group, Inc. | 274,226 | 12,176 | ||||||
* | Fifth Street Asset Management, Inc. | 220,808 | 3,080 | ||||||
* | First Cash Financial Services, Inc. | 180,702 | 10,060 | ||||||
FirstService Corporation† | 119,268 | 6,066 | |||||||
FXCM, Inc. | 668,110 | 11,070 | |||||||
* | OM Asset Management plc† | 289,831 | 4,707 | ||||||
* | PRA Group, Inc. | 91,760 | 5,316 | ||||||
59,905 | |||||||||
Consumer Staples—3.2% | |||||||||
Nu Skin Enterprises, Inc. | 281,280 | 12,292 | |||||||
WD-40 Co. | 51,149 | 4,352 | |||||||
16,644 | |||||||||
Energy—2.3% | |||||||||
* | Bonanza Creek Energy, Inc. | 89,060 | 2,138 | ||||||
* | Carrizo Oil & Gas, Inc. | 113,873 | 4,737 | ||||||
* | Parsley Energy, Inc. | 131,603 | 2,100 | ||||||
* | Rosetta Resources, Inc. | 116,910 | 2,608 | ||||||
11,583 | |||||||||
Materials—1.2% | |||||||||
* | Stillwater Mining Co. | 428,566 | 6,317 | ||||||
Total Common Stocks—97.0% (cost $414,508) | 497,024 | ||||||||
Exchange-Traded Fund | |||||||||
iShares Russell 2000 Growth Index Fund | 26,640 | 3,793 | |||||||
Total Exchange-Traded Fund—0.8% (cost $3,484) | 3,793 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 33 |
Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Principal | |||||||||
Issuer | Amount | Value | |||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $12,995, collateralized by U.S. Treasury Notes, 2.375%, due 8/15/24 | $ | 12,995 | $ | 12,995 | |||||
Total Repurchase Agreement—2.5% (cost $12,995) | 12,995 | ||||||||
Total Investments—100.3% (cost $430,987) | 513,812 | ||||||||
Liabilities, plus cash and other assets—(0.3)% | (1,370 | ) | |||||||
Net assets—100.0% | $ | 512,442 |
ADR = American Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
If a fund’s portfolio holdings represent ownership of 5% or more of the voting securities of a company, the company is deemed to be an affiliate as defined in the Investment Company Act of 1940. The Fund had the following transactions during the year ended December 31, 2014 with companies deemed affiliated during the year or at December 31, 2014 (dollar amounts in thousands).
Share Activity | Year Ended December 31, 2014 | ||||||||||||||||||||||||||||||||||||
Security Name | Balance 12/31/2013 | Purchases | Sales | Balance 12/31/2014 | Value | Dividend Income | Net realized gain (loss) | Change in net unrealized appreciation (depreciation) | |||||||||||||||||||||||||||||
ᴫ | Hudson Technologies, Inc. | 1,261,512 | 701,399 | 251,207 | 1,711,704 | $ | 6,453 | $ | — | $ | (388 | ) | $ | 774 | |||||||||||||||||||||||
Inuvo, Inc. | 1,481,955 | — | 1,481,955 | — | — | — | (7,376 | ) | 6,799 | ||||||||||||||||||||||||||||
U.S. Auto Parts Network, Inc. | 2,401,604 | 745,861 | 1,710,045 | 1,437,420 | 3,364 | — | (1,691 | ) | 2,906 | ||||||||||||||||||||||||||||
$ | 9,817 | $ | — | $ | (9,455 | ) | $ | 10,479 |
ᴫAffiliated company at December 31, 2014. The Fund’s total value in companies deemed to be affiliated at December 31, 2014 was $6,453 (in thousands).
See accompanying Notes to Financial Statements.
34 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 35 |
Small Cap Value Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | 4.49 | % | 17.75 | % | 14.75 | % | 7.97 | % | ||||||||
Class I | 4.73 | 18.04 | 15.02 | 8.21 | ||||||||||||
Russell 2000® Value Index | 4.22 | 18.29 | 14.26 | 6.89 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in smaller companies involves special risks, including higher volatility and lower liquidity. Smaller Capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Russell 2000® Value Index consists of small-capitalization companies with below average price-to-book ratios and forecasted growth rates.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
36 | Annual Report | December 31, 2014 |
Small Cap Value Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Financials—36.0% | |||||||||
Acadia Realty Trust | 244,180 | $ | 7,821 | ||||||
American Assets Trust, Inc. | 196,590 | 7,826 | |||||||
American Campus Communities, Inc. | 141,885 | 5,868 | |||||||
Bank of the Ozarks, Inc. | 213,950 | 8,113 | |||||||
Boston Private Financial Holdings, Inc. | 587,378 | 7,912 | |||||||
CNO Financial Group, Inc. | 511,945 | 8,816 | |||||||
CoBiz Financial, Inc. | 544,514 | 7,149 | |||||||
Douglas Emmett, Inc. | 205,980 | 5,850 | |||||||
* | Eagle Bancorp, Inc. | 198,540 | 7,052 | ||||||
East West Bancorp, Inc. | 201,470 | 7,799 | |||||||
EastGroup Properties, Inc. | 66,615 | 4,218 | |||||||
Education Realty Trust, Inc. | 191,781 | 7,017 | |||||||
EPR Properties | 101,740 | 5,863 | |||||||
* | Forest City Enterprises, Inc. | 234,820 | 5,002 | ||||||
FXCM, Inc. | 270,643 | 4,485 | |||||||
Glacier Bancorp, Inc. | 287,475 | 7,983 | |||||||
Hanover Insurance Group, Inc. | 114,875 | 8,193 | |||||||
Highwoods Properties, Inc. | 135,675 | 6,008 | |||||||
Home BancShares, Inc. | 241,240 | 7,758 | |||||||
Iberiabank Corporation | 104,730 | 6,792 | |||||||
LaSalle Hotel Properties | 185,120 | 7,492 | |||||||
PacWest Bancorp | 179,798 | 8,174 | |||||||
Pebblebrook Hotel Trust | 203,944 | 9,306 | |||||||
Radian Group, Inc. | 443,500 | 7,415 | |||||||
Renasant Corporation | 164,136 | 4,748 | |||||||
* | Safeguard Scientifics, Inc. | 279,091 | 5,532 | ||||||
Selective Insurance Group, Inc. | 303,810 | 8,255 | |||||||
* | Western Alliance Bancorp | 351,545 | 9,773 | ||||||
WSFS Financial Corporation | 86,400 | 6,643 | |||||||
* | Yadkin Financial Corporation | 300,840 | 5,911 | ||||||
210,774 | |||||||||
Industrials—14.6% | |||||||||
Barnes Group, Inc. | 170,070 | 6,294 | |||||||
CIRCOR International, Inc. | 102,100 | 6,155 | |||||||
Curtiss-Wright Corporation | 120,430 | 8,501 | |||||||
EMCOR Group, Inc. | 132,601 | 5,899 | |||||||
* | Esterline Technologies Corporation | 72,940 | 8,000 | ||||||
G&K Services, Inc. | 149,628 | 10,601 | |||||||
* | Generac Holdings, Inc. | 95,955 | 4,487 | ||||||
Interface, Inc. | 240,004 | 3,953 | |||||||
Kadant, Inc. | 125,183 | 5,344 | |||||||
* | Moog, Inc. | 80,469 | 5,957 | ||||||
* | Northwest Pipe Co. | 146,860 | 4,423 | ||||||
Standex International Corporation | 54,510 | 4,212 | |||||||
* | Swift Transportation Co. | 192,690 | 5,517 | ||||||
The Toro Co. | 91,470 | 5,837 | |||||||
85,180 | |||||||||
Consumer Discretionary—11.9% | |||||||||
Brunswick Corporation | 134,865 | 6,913 | |||||||
Children’s Place, Inc. | 88,545 | 5,047 | |||||||
Core-Mark Holding Co., Inc. | 70,567 | 4,370 | |||||||
Dana Holding Corporation | 266,510 | 5,794 | |||||||
Ethan Allen Interiors, Inc. | 170,165 | 5,270 | |||||||
* | Genesco, Inc. | 79,770 | 6,112 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Consumer Discretionary—(continued) | |||||||||
* | Krispy Kreme Doughnuts, Inc. | 482,235 | $ | 9,519 | |||||
Meredith Corporation | 112,340 | 6,102 | |||||||
* | PEP Boys-Manny, Moe & Jack | 311,175 | 3,056 | ||||||
Ryland Group, Inc. | 148,225 | 5,716 | |||||||
Vail Resorts, Inc. | 64,165 | 5,848 | |||||||
Wolverine World Wide, Inc. | 209,065 | 6,161 | |||||||
69,908 | |||||||||
Information Technology—11.4% | |||||||||
* | Acxiom Corporation | 392,110 | 7,948 | ||||||
ADTRAN, Inc. | 231,520 | 5,047 | |||||||
* | Atmel Corporation | 703,030 | 5,902 | ||||||
Belden, Inc. | 94,005 | 7,408 | |||||||
Booz Allen Hamilton Holding Corporation | 109,440 | 2,903 | |||||||
* | Cadence Design Systems, Inc. | 423,235 | 8,029 | ||||||
EVERTEC, Inc.† | 236,954 | 5,244 | |||||||
* | Inphi Corporation | 461,494 | 8,528 | ||||||
* | Intralinks Holdings, Inc. | 401,390 | 4,777 | ||||||
j2 Global, Inc. | 109,025 | 6,760 | |||||||
* | PTC, Inc. | 112,300 | 4,116 | ||||||
66,662 | |||||||||
Utilities—6.8% | |||||||||
ALLETE, Inc. | 146,470 | 8,076 | |||||||
PNM Resources, Inc. | 277,625 | 8,226 | |||||||
Portland General Electric Co. | 206,150 | 7,798 | |||||||
South Jersey Industries, Inc. | 120,375 | 7,094 | |||||||
Southwest Gas Corporation | 138,080 | 8,535 | |||||||
39,729 | |||||||||
Health Care—5.5% | |||||||||
CONMED Corporation | 140,425 | 6,314 | |||||||
* | Greatbatch, Inc. | 161,975 | 7,985 | ||||||
HealthSouth Corporation | 148,615 | 5,716 | |||||||
* | Magellan Health, Inc. | 65,920 | 3,957 | ||||||
* | Mednax, Inc. | 124,626 | 8,239 | ||||||
32,211 | |||||||||
Materials—5.3% | |||||||||
Minerals Technologies, Inc. | 104,260 | 7,241 | |||||||
PolyOne Corporation | 188,299 | 7,138 | |||||||
* | RTI International Metals, Inc. | 159,535 | 4,030 | ||||||
Sensient Technologies Corporation | 115,060 | 6,943 | |||||||
Silgan Holdings, Inc. | 103,990 | 5,574 | |||||||
30,926 | |||||||||
Energy—3.9% | |||||||||
* | *Bonanza Creek Energy, Inc. | 110,360 | 2,649 | ||||||
Exterran Holdings, Inc. | 145,145 | 4,729 | |||||||
GasLog, Ltd.† | 53,111 | 1,081 | |||||||
* | Helix Energy Solutions Group, Inc. | 216,810 | 4,705 | ||||||
* | PDC Energy, Inc. | 68,550 | 2,829 | ||||||
* | Ring Energy, Inc. | 143,465 | 1,506 | ||||||
* | Rosetta Resources, Inc. | 80,420 | 1,794 | ||||||
* | TETRA Technologies, Inc. | 550,025 | 3,674 | ||||||
22,967 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 37 |
Small Cap Value Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Shares or | |||||||||
Principal | |||||||||
Issuer | Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Consumer Staples—3.2% | |||||||||
* | Darling Ingredients, Inc. | 273,725 | $ | 4,971 | |||||
J&J Snack Foods Corporation | 67,382 | 7,329 | |||||||
SpartanNash Co. | 239,674 | 6,265 | |||||||
18,565 | |||||||||
Total Common Stocks—98.6% (cost $471,405) | 576,922 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $4,649, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 4,649 | 4,649 | ||||||
Total Repurchase Agreement—0.8% (cost $4,649) | 4,649 | ||||||||
Total Investments—99.4% (cost $476,054) | 581,571 | ||||||||
Cash and other assets, less liabilities—0.6% | 3,615 | ||||||||
Net assets—100.0% | $ | 585,186 |
* Non-income producing securities
† = U.S. listed foreign security
See accompanying Notes to Financial Statements.
38 | Annual Report | December 31, 2014 |
GLOBAL MARKETS REVIEW AND OUTLOOK
Global Markets Overview
Global equity markets continued to be buoyed by strong U.S. performance in the fourth quarter, as improving economic data combined with the Federal Reserve’s (the “Fed”) reassurances that it would be patient with rate hikes helped to propel U.S. stocks to record highs. Central bank policy accommodation was once again a dominant market theme in 2014, helping equities overcome a broad range of geopolitical and economic risk factors during the year – from the Ukraine conflict and slowing growth in China to Europe deflation fears, the Ebola virus and plunging oil prices. The MSCI ACWI IMI (net) advanced 3.84% for the calendar year in U.S. dollar terms. In local currency terms, the Index was up for 2014, highlighting the magnitude of USD appreciation versus primary currencies including the euro, sterling and yen, and emerging market currencies ranging from the Brazilian real to the Russian ruble.
From a style perspective, William Blair’s proprietary quantitative models indicated that higher quality companies with positive earnings trends outperformed during the calendar year on a global basis, although factor performance varied across regions and market cap segments throughout the year. For example, while higher quality and positive earnings trends/operating momentum were notable contributors in Europe, Japan market leadership was characterized by low quality, low valuation and poor earnings trend factors. There were periods of significant style volatility in 2014. Figure 1 illustrates monthly quantitative model performance, highlighting not only the divergence of valuation and momentum during the year, but the sharp performance reversal between these factors in March, which persisted through July.
Figure 1
MSCI ACWI Quant Model Performance
Quintile 1–Quintile 5 (%)
Source: Summit/William Blair
Note: “Etrend” refers to earnings trend
As the second half of 2014 progressed, the market increasingly rewarded those companies exhibiting high quality characteristics and good earnings fundamentals, with high valuation being less of a headwind.
Non-U.S. developed markets posted negative USD returns for the year due to broad USD appreciation as previously noted, negating positive local currency returns in several markets including Japan, Europe and the U.K. Japan outpaced other primary markets in 4Q14 despite the yen’s 8.5% decline – notably breaching the ¥120 threshold in early December for the first time since 2006 amid expectations of expanded stimulus measures following weaker-than-expected GDP. Prime Minister Abe’s subsequent decision to postpone the October 2015 consumption tax increase by 18 months was well received by voters who secured him victory in the December election, providing a firmer mandate for the Liberal Democratic Party to pursue structural “third-arrow” reforms. In Europe, concerns about political turmoil in Greece resurfaced in December, capping an earlier rally that had been fueled in part by hopes of a new quantitative easing program by the European Central Bank. The prospects for additional stimulus measures weighed on the euro, which weakened approximately 4% versus the USD during 4Q14. UK equities were similarly hampered by the pound’s 4% decline during the quarter. In contrast to Europe and Japan, expectations of an initial interest rate rise by the Bank of England resulted in a more muted loss of 6% for the pound in 2014, significantly less than the 12% declines in the euro and yen.
For the year, however, emerging markets held up better than their non-U.S. developed market counterparts despite myriad concerns, including Fed tapering, slowing growth, and falling commodity prices. While the oil price collapse weighed on investor sentiment in oil export markets such as Russia, Brazil and the Middle East, it supported share price performance in net energy import countries such as India and Turkey during the quarter and year. China also benefited to some extent from its status as an energy importer, but outperformance during the quarter and year was driven more by stimulus measures and expectations of further monetary easing in response to the weaker growth environment. Investors were also encouraged by signs of progress on China reform measures including state owned enterprise (“SOE”) restructuring, fiscal reforms and financial sector liberalization. Indian equities similarly benefited from improving reform prospects under the new Modi government, advancing nearly 28% in USD terms during 2014. We believe that the broad range of performance across emerging markets in 2014 reflected increasingly divergent growth trajectories, reform prospects, and corporate fundamentals. The significant decline in country correlations (Figure 2) was compelling evidence that investors were less inclined to view emerging markets as a homogenous group.
December 31, 2014 | William Blair Funds | 39 |
GLOBAL MARKETS REVIEW AND OUTLOOK—CONTINUED
Figure 2
Source: Credit Suisse. Represents 6 month correlation among emerging markets proxied by the standard deviation of performance, adjusted for market volatility. As of December 31.
For the calendar year, Healthcare and Utilities were the leading sectors, which was largely reflective of investors’ yield-seeking behavior amid the weaker global growth environment and disinflation backdrop. In addition to the focus on yield and free cash flow, corporate deal activity was a key driver of Healthcare performance in 2014. On the opposite end of the performance spectrum were the commodities sectors, hampered by oversupply and weakening global demand. OPEC’s surprise decision in late November not to lower its production ceiling weighed significantly on the oil price and Energy sector broadly, with services companies bearing the brunt of the selloff on fears of capital expenditure cuts by the major oil and gas producers.
Figure 3
USD Returns (%) | 4Q14 | 2014 |
MSCI ACWI IMI (net) | 0.59 | 3.84 |
Discretionary | 5.56 | 3.08 |
Staples | 3.00 | 6.01 |
Energy | -16.78 | -15.21 |
Financials | 1.99 | 4.00 |
Healthcare | 3.62 | 17.94 |
Industrials | 0.64 | -0.47 |
IT | 3.99 | 13.73 |
Materials | -4.94 | -6.76 |
Telecom | -2.81 | -1.53 |
Utilities | 3.87 | 13.80 |
Source: Factset
Finally, from a size perspective, global large and mid cap stocks outperformed their small cap counterparts in 2014 for the first time since 2011, led by large cap dominance in the U.S. (Figure 4). This theme was reversed in emerging markets, however, as emerging markets small caps significantly outperformed for the year, with particular strength in India small caps (+57%). As shown in Figure 4, market cap leadership trends reversed during 4Q14 in both developed and emerging markets.
Figure 4
Large/Mid Cap Excess Return vs. Small Cap (USD %)
4Q14 | 2014 | |
United States | -2.32 | 5.62 |
Developed ex-US | -0.31 | 1.03 |
Emerging Markets | 1.52 | -3.20 |
Source: Factset. MSCI Standard vs. Small Cap Net Indices
From a corporate fundamentals perspective, earnings trends continued to be stronger in large/mid caps at year end across the primary geographic segments (Figure 5). The earnings trend/valuation tradeoff, as measured by the William Blair quantitative models (Figure 5), illustrated the relatively attractive profile of the Non-U.S. Developed Market Large/Mid segment in this context. Not surprisingly, the U.S. remained relatively expensive across the market cap spectrum, but this premium was supported by better earnings trends.
Figure 5
Source: William Blair Quantitative Models. 1 is best, 100 is worst. Large/Mid defined as companies ≥$4B float-adjusted market cap; small cap is <$4B float-adjusted market cap.
Global Markets Outlook
The U.S. enjoyed good equity performance in 2013 and 2014 driven mostly by multiple expansion. While earnings have been catching up, U.S. valuations are extended versus the rest of the world. We believe this premium has been warranted since corporate performance has been much better in the U.S. than it has been in many other places. With respect to the earnings outlook, there has been considerable discussion that U.S. corporate profit margins will come under pressure. To the extent that we are not seeing wage growth being a significant
40 | Annual Report | December 31, 2014 |
GLOBAL MARKETS REVIEW AND OUTLOOK—CONTINUED
impediment to margins, we believe U.S. corporations will likely sustain their profitability profiles.
Return prospects beyond the U.S. may be increasingly influenced by structural reforms in several important markets, including Japan, Europe, China and India. In Japan, while various portions of the three arrows of Abenomics remain somewhat unfulfilled, the fundamental trends are encouraging. Using our earnings trend/valuation lens, the most interesting region globally remains Japan, with strong earnings trends and supportive valuations across most sectors. With regard to retail sales, efforts to improve consumer sentiment were not helped by the sales tax increase in the spring of 2014. The result has been the postponement of the second tax increase, which could be positive for the economy more broadly. From a corporate performance perspective, the virtuous circle, in which higher return on equity is sought by management and rewarded by the market, is a significant change in the mental approach toward investment in Japan. Improved corporate performance evidenced by higher earnings, better dividends, and share buybacks that have been significantly ahead of market expectations, has given us confidence that reforms are already producing results. We are particularly encouraged by the recently launched JPX-Nikkei 400 Index targeting high ROE companies with good governance standards, and the Government Pension Investment Fund’s doubling of its target equities allocation in an effort to improve prospective returns.
In the case of India, the goal of the near term reforms is to change the mix of economic growth and inflation. In the years preceding the financial crisis, India experienced strong growth and relatively low inflation. Over the past five years, the picture has completely reversed, with prices growing at or near a double-digit pace, while the economy grew at half the pace of the 2000s. Although inflation fell noticeably in the second half of 2014, Reserve Bank of India Governor Raghuram Rajan has yet to cut interest rates. Rajan’s actions suggest that the government is serious about reining in inflation to pave the way for productive investment and growth. For growth to accelerate, India needs massive private and public investment. Ultimately, the objective is to incentivize investments and to bring investment growth to generate further output gains. Equity valuations are clearly above their 10 year average, but this does not necessarily mean they are overextended. Quality companies, as demonstrated through recent (or historic) corporate performance, are quite abundant in India. It is not surprising for the technology sector to be a source of high quality companies, with well-known leaders in IT services, but we also see strong corporate performance in pharmaceuticals and the automotive industry.
Deciphering China’s reform efforts is considerably more challenging. In the initial decades, China’s remarkable growth
was based on an intertwined relationship between SOEs, local governments and large, state-owned banks. Such a system was very successful in rapidly mobilizing financial resources and developing infrastructure. At the same time, the private sector developed largely outside of this triumvirate, with little access to capital or resources. The private sector flourished despite these obstacles. Today, private companies in China account for nearly 90% of employment and the vast majority of corporate profits. It is widely acknowledged that services and consumption are best delivered by market-based mechanisms. Chinese leaders have long recognized this, and efforts to open private sectors to capital more formally while dismantling SOE dominance are well underway.
Even the Euro Area is undertaking major reforms. This is not limited to the recently announced infrastructure spending initiative in Europe, which so far has included few details and garnered little enthusiasm from the private sector. Perhaps most notably, 15 years after the introduction of the single currency, there will finally be a European banking union. As of November 2014, there is now a single, pan-European banking regulator, hastening the development of a fully integrated financial services market. From a portfolio strategy perspective, we believe that the low inflation/low nominal growth environment in Europe necessitates a renewed focus on high quality companies with proven ability to generate cash flow for either profitable reinvestment opportunities or capital returns.
All of the aforementioned structural reforms are growth-promoting and disinflationary over time to the extent that they take costs out of the production of goods and services. In the more immediate future, our expectation is for a resilient world economy in 2015, but with a moderate growth profile overall: IMF data project global GDP growth around 3.3% - 3.5%. The U.S. and Europe are expected to benefit from dissipating fiscal drag, while the Japanese tax increase postponement should have a positive impact. Emerging markets should benefit from lower commodity prices, stable developed market demand and domestic reform efforts. Disinflation is likely to persist, as we expect globalization, structural reforms, and technological changes to continue to drive lower prices. The emerging markets will continue to be important to investors, but differentiation among countries, sectors and companies will be critical to success. In our view the emerging markets are not a homogenous group: the prospects for India are significantly different than those for Russia. As always, we will continue to seek sustainable corporate returns. We strongly believe that companies that demonstrate high returns on investment are better positioned to navigate this environment, and have better potential to provide a solid foundation for the Funds.
December 31, 2014 | William Blair Funds | 41 |
42 | Annual Report | December 31, 2014 |
Global Leaders Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | Since Inception | |||||||||||||
Class N(a) | 3.76 | % | 13.71 | % | 11.33 | % | 2.56 | % | ||||||||
Class I(a) | 4.08 | 14.02 | 11.60 | 2.84 | ||||||||||||
MSCI ACW IMI (net)(a) | 3.84 | 14.30 | 9.48 | 2.34 | ||||||||||||
Institutional Class(b) | 4.24 | — | — | 12.01 | ||||||||||||
MSCI ACW IMI (net)(b) | 3.84 | — | — | 12.83 |
(a) | Since inception is for the period from October 15, 2007 (Commencement of Operations) to December 31, 2014. |
(b) | Since inception is for the period from December 19, 2012 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in smaller and medium capitalization companies involves special risks, including higher volatility and lower liquidity. Smaller and medium capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution fees (12b-1). Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) All Country World (ACW) Investable Market Index (IMI) (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market of developed and emerging markets. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 43 |
Global Leaders Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Western Hemisphere—50.4% | |||||||||
Canada—4.5% | |||||||||
Alimentation Couche Tard, Inc. Class “B” (Food & staples retailing) | 64,856 | $ | 2,718 | ||||||
Brookfield Asset Management, Inc. Class “A” (Real estate management & development)† | 40,157 | 2,013 | |||||||
Suncor Energy, Inc. (Oil, gas & consumable fuels) | 84,800 | 2,694 | |||||||
7,425 | |||||||||
United States—45.9% | |||||||||
* | Affiliated Managers Group, Inc. (Capital markets) | 10,360 | 2,199 | ||||||
* | Akamai Technologies, Inc. (Internet software & services) | 32,332 | 2,036 | ||||||
* | Align Technology, Inc. (Health care equipment & supplies) | 29,706 | 1,661 | ||||||
American Express Co. (Consumer finance) | 39,258 | 3,652 | |||||||
Bristol-Myers Squibb Co. (Pharmaceuticals) | 42,044 | 2,482 | |||||||
* | Cognizant Technology Solutions Corporation (IT services) | 45,058 | 2,373 | ||||||
Colgate-Palmolive Co. (Household products) | 42,852 | 2,965 | |||||||
* | CoStar Group, Inc. (Internet software & services) | 5,310 | 975 | ||||||
Costco Wholesale Corporation (Food & staples retailing) | 13,614 | 1,930 | |||||||
EOG Resources, Inc. (Oil, gas & consumable fuels) | 25,087 | 2,310 | |||||||
* | Facebook, Inc. (Internet software & services) | 26,429 | 2,062 | ||||||
* | Gilead Sciences, Inc. (Biotechnology) | 43,183 | 4,070 | ||||||
* | IDEXX Laboratories, Inc. (Health care equipment & supplies) | 12,475 | 1,850 | ||||||
Jones Lang LaSalle, Inc. (Real estate management & development) | 18,199 | 2,728 | |||||||
JPMorgan Chase & Co. (Banks) | 39,332 | 2,461 | |||||||
Keurig Green Mountain, Inc. (Food products) | 10,677 | 1,413 | |||||||
Lazard, Ltd. Class “A” (Capital markets)† | 39,169 | 1,960 | |||||||
Mastercard, Inc. (IT services) | 38,827 | 3,345 | |||||||
* | O’Reilly Automotive, Inc. (Specialty retail) | 10,579 | 2,038 | ||||||
* | Old Dominion Freight Line, Inc. (Road & rail) | 23,366 | 1,814 | ||||||
* | Pandora Media, Inc. (Internet software & services) | 7,271 | 130 | ||||||
Pioneer Natural Resources Co. (Oil, gas & consumable fuels) | 7,319 | 1,089 | |||||||
PPG Industries, Inc. (Chemicals) | 13,894 | 3,211 | |||||||
* | PRA Group, Inc. (Consumer finance) | 32,498 | 1,883 | ||||||
* | Red Hat, Inc. (Software) | 28,570 | 1,975 | ||||||
Robert Half International, Inc. (Professional services) | 48,789 | 2,848 | |||||||
Schlumberger, Ltd. (Energy equipment & services)† | 26,058 | 2,226 | |||||||
The Home Depot, Inc. (Specialty retail) | 46,483 | 4,879 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Western Hemisphere—(continued) | |||||||||
United States—(continued) | |||||||||
* | The Middleby Corporation (Machinery) | 4,913 | $ | 487 | |||||
* | The Priceline Group, Inc. (Internet & catalog retail) | 3,029 | 3,454 | ||||||
The Toro Co. (Machinery) | 19,460 | 1,242 | |||||||
VF Corporation (Textiles, apparel & luxury goods) | 36,446 | 2,730 | |||||||
Williams-Sonoma, Inc. (Specialty retail) | 34,707 | 2,627 | |||||||
75,105 | |||||||||
Europe, Mid-East—16.0% | |||||||||
Denmark—1.4% | |||||||||
Novo Nordisk A/S Class “B” (Pharmaceuticals) | 55,152 | 2,333 | |||||||
France—1.5% | |||||||||
Cap Gemini S.A. (IT services) | 33,427 | 2,390 | |||||||
Germany—1.6% | |||||||||
Bayerische Motoren Werke AG (Automobiles) | 23,814 | 2,570 | |||||||
Ireland—1.0% | |||||||||
Shire plc (Pharmaceuticals) | 22,745 | 1,613 | |||||||
Israel—3.1% | |||||||||
* | Check Point Software Technologies, Ltd. (Software)† | 21,867 | 1,718 | ||||||
Teva Pharmaceutical Industries, Ltd.—ADR (Pharmaceuticals) | 57,588 | 3,312 | |||||||
5,030 | |||||||||
Netherlands—0.7% | |||||||||
Royal Dutch Shell plc (Oil, gas & consumable fuels) | 34,268 | 1,142 | |||||||
Sweden—1.7% | |||||||||
Atlas Copco AB Class “A” (Machinery) | 82,568 | 2,297 | |||||||
Hexagon AB Class “B” (Electronic equipment, instruments & components) | 17,201 | 531 | |||||||
2,828 | |||||||||
Switzerland—5.0% | |||||||||
Geberit AG (Building products) | 4,709 | 1,593 | |||||||
Partners Group Holding AG (Capital markets) | 7,485 | 2,178 | |||||||
Roche Holding AG (Pharmaceuticals) | 9,293 | 2,518 | |||||||
Sika AG (Chemicals) | 175 | 516 | |||||||
Sonova Holding AG (Health care equipment & supplies) | 10,007 | 1,470 | |||||||
8,275 | |||||||||
Japan—11.5% | |||||||||
Daikin Industries, Ltd. (Building products) | 42,400 | 2,719 | |||||||
Fuji Heavy Industries, Ltd. (Automobiles) | 44,300 | 1,568 | |||||||
GLP J-Reit (Real estate investment trusts (REITs)) | 1,369 | 1,525 | |||||||
Hoya Corporation (Electronic equipment, instruments & components) | 59,100 | 1,999 | |||||||
Kao Corporation (Personal products) | 62,300 | 2,457 | |||||||
Keyence Corporation (Electronic equipment, instruments & components) | 2,800 | 1,248 |
See accompanying Notes to Financial Statements.
44 | Annual Report | December 31, 2014 |
Global Leaders Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Japan—(continued) | |||||||||
Nitori Holdings Co., Ltd. (Specialty retail) | 28,300 | $ | 1,520 | ||||||
ORIX Corporation (Diversified financial services) | 170,500 | 2,145 | |||||||
SMC Corporation (Machinery) | 5,700 | 1,495 | |||||||
Sumitomo Mitsui Financial Group, Inc. (Banks) | 58,400 | 2,111 | |||||||
18,787 | |||||||||
Emerging Asia—9.0% | |||||||||
China—4.5% | |||||||||
* | Alibaba Group Holding, Ltd.—ADR (Internet software & services) | 14,770 | 1,535 | ||||||
* | Baidu, Inc.—ADR (Internet software & services) | 10,117 | 2,307 | ||||||
China Overseas Land & Investment, Ltd. (Real estate management & development) | 584,000 | 1,731 | |||||||
Tencent Holdings, Ltd. (Internet software & services) | 118,900 | 1,720 | |||||||
7,293 | |||||||||
India—1.4% | |||||||||
Tata Motors, Ltd. (Automobiles) | 298,795 | 2,336 | |||||||
Indonesia—1.3% | |||||||||
PT Bank Rakyat Indonesia Persero Tbk (Banks) | 2,290,700 | 2,153 | |||||||
Taiwan—1.8% | |||||||||
Taiwan Semiconductor Manufacturing Co., Ltd.—ADR (Semiconductors & semiconductor equipment) | 132,412 | 2,964 | |||||||
United Kingdom—7.2% | |||||||||
ARM Holdings plc (Semiconductors & semiconductor equipment) | 52,164 | 801 | |||||||
Babcock International Group plc (Commercial services & supplies) | 41,679 | 683 | |||||||
BG Group plc (Oil, gas & consumable fuels) | 96,432 | 1,291 | |||||||
Compass Group plc (Hotels, restaurants & leisure) | 172,354 | 2,946 | |||||||
easyJet plc (Airlines) | 106,857 | 2,765 | |||||||
Prudential plc (Insurance) | 102,015 | 2,359 | |||||||
Reckitt Benckiser Group plc (Household products) | 12,052 | 976 | |||||||
11,821 | |||||||||
Asia—1.8% | |||||||||
Hong Kong—1.8% | |||||||||
AIA Group, Ltd. (Insurance) | 316,600 | 1,740 | |||||||
MGM China Holdings, Ltd. (Hotels, restaurants & leisure) | 476,000 | 1,202 | |||||||
2,942 | |||||||||
Emerging Latin America—1.3% | |||||||||
Brazil—0.6% | |||||||||
Kroton Educacional S.A. (Diversified consumer services) | 178,300 | 1,039 | |||||||
Panama—0.7% | |||||||||
Copa Holdings S.A. Class “A” (Airlines)† | 10,385 | 1,076 |
Shares or | |||||||||
Principal | |||||||||
Issuer | Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Europe, Mid-East, Africa—0.6% | |||||||||
South Africa—0.6% | |||||||||
Bidvest Group, Ltd. (Industrial conglomerates) | 34,472 | $ | 901 | ||||||
Total Common Stocks—97.8% (cost $138,939) | 160,023 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $7,885, collateralized by Federal Farm Credit Bank, 2.700%, due 12/2/24 | $ | 7,885 | 7,885 | ||||||
Total Repurchase Agreement—4.8% (cost $7,885) | 7,885 | ||||||||
Total Investments—102.6% (cost $146,824) | 167,908 | ||||||||
Liabilities, plus cash and other assets—(2.6)% | (4,246 | ) | |||||||
Net assets—100.0% | $ | 163,662 |
ADR = American Depository Receipt
† = U.S. listed foreign security
* Non-income producing securities
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 20.6 | % | ||
Information Technology | 18.8 | % | ||
Consumer Discretionary | 18.1 | % | ||
Health Care | 13.3 | % | ||
Industrials | 12.4 | % | ||
Consumer Staples | 7.8 | % | ||
Energy | 6.7 | % | ||
Materials | 2.3 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
U.S. Dollar | 56.3 | % | ||
Japanese Yen | 11.7 | % | ||
British Pound Sterling | 8.4 | % | ||
Swiss Franc | 5.2 | % | ||
Hong Kong Dollar | 4.0 | % | ||
Euro | 3.8 | % | ||
Canadian Dollar | 3.4 | % | ||
Swedish Krona | 1.8 | % | ||
Indian Rupee | 1.5 | % | ||
Danish Krone | 1.4 | % | ||
Indonesian Rupiah | 1.3 | % | ||
All Other Currencies | 1.2 | % | ||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 45 |
46 | Annual Report | December 31, 2014 |
Global Small Cap Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||
Since | ||||||||
1 Year | Inception(a) | |||||||
Class N | 4.93 | % | 16.86 | % | ||||
Class I | 5.26 | 17.20 | ||||||
MSCI ACW Small Cap Index (net) | 1.78 | 11.02 |
(a) | For the period from April 10, 2013 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Investing in smaller and medium capitalization companies involves special risks, including higher volatility and lower liquidity. Smaller and medium capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. From time to time, the investment adviser may waive fees or reimburse expenses to the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) All Country World (ACW) Small Cap Index (net) is a free float-adjusted market capitalization index designed to measure global developed and emerging market small capitalization equity performance. The Index is unmanaged, does not incur fees or expenses, and cannot be invested in directly.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 47 |
Global Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Western Hemisphere—46.7% | |||||||||
Canada—3.2% | |||||||||
Constellation Software, Inc. (Software) | 922 | $ | 274 | ||||||
Home Capital Group, Inc. (Thrifts & mortgage finance) | 6,909 | 286 | |||||||
Linamar Corporation (Auto components) | 4,745 | 290 | |||||||
Total Energy Services, Inc. (Energy equipment & services) | 20,064 | 224 | |||||||
WestJet Airlines, Ltd. (Airlines) | 10,012 | 290 | |||||||
1,364 | |||||||||
United States—43.5% | |||||||||
* | 2U, Inc. (Diversified consumer services) | 19,149 | 376 | ||||||
* | Addus HomeCare Corporation (Health care providers & services) | 11,375 | 276 | ||||||
* | Akorn, Inc. (Pharmaceuticals) | 8,496 | 308 | ||||||
* | Align Technology, Inc. (Health care equipment & supplies) | 9,947 | 556 | ||||||
* | AMN Healthcare Services, Inc. (Health care providers & services) | 25,489 | 500 | ||||||
Bio-Techne Corporation (Life sciences tools & services) | 4,823 | 446 | |||||||
Booz Allen Hamilton Holding Corporation (IT services) | 22,239 | 590 | |||||||
* | Carrizo Oil & Gas, Inc. (Oil, gas & consumable fuels) | 7,365 | 306 | ||||||
Choice Hotels International, Inc. (Hotels, restaurants & leisure) | 9,887 | 554 | |||||||
* | Cognex Corporation (Electronic equipment, instruments & components) | 8,426 | 348 | ||||||
* | Cvent, Inc. (Internet software & services) | 15,983 | 445 | ||||||
* | Demandware, Inc. (Internet software & services) | 6,402 | 368 | ||||||
* | Diamondback Energy, Inc. (Oil, gas & consumable fuels) | 4,818 | 288 | ||||||
Domino’s Pizza, Inc. (Hotels, restaurants & leisure) | 4,653 | 438 | |||||||
* | Drew Industries, Inc. (Auto components) | 9,935 | 507 | ||||||
* | Encore Capital Group, Inc. (Consumer finance) | 10,389 | 461 | ||||||
* | Forum Energy Technologies, Inc. (Energy equipment & services) | 13,824 | 287 | ||||||
Gentex Corporation (Auto components) | 14,130 | 511 | |||||||
* | Gentherm, Inc. (Auto components) | 8,929 | 327 | ||||||
HealthSouth Corporation (Health care providers & services) | 7,478 | 288 | |||||||
Herman Miller, Inc. (Commercial services & supplies) | 15,545 | 457 | |||||||
* | Hexcel Corporation (Aerospace & defense) | 7,761 | 322 | ||||||
* | Hortonworks, Inc. (Internet software & services) | 17,253 | 466 | ||||||
* | Huron Consulting Group, Inc. (Professional services) | 6,586 | 450 | ||||||
j2 Global, Inc. (Internet software & services) | 6,215 | 385 | |||||||
* | Ligand Pharmaceuticals, Inc. (Biotechnology) | 6,057 | 322 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Western Hemisphere—(continued) | |||||||||
United States—(continued) | |||||||||
MAXIMUS, Inc. (IT services) | 5,871 | $ | 322 | ||||||
Monotype Imaging Holdings, Inc. (Software) | 17,158 | 495 | |||||||
* | Oil States International, Inc. (Energy equipment & services) | 6,866 | 336 | ||||||
* | PRA Group, Inc. (Consumer finance) | 8,569 | 496 | ||||||
* | ServiceMaster Global Holdings, Inc. (Diversified consumer services) | 11,862 | 318 | ||||||
* | Sirona Dental Systems, Inc. (Health care equipment & supplies) | 5,821 | 509 | ||||||
Six Flags Entertainment Corporation (Hotels, restaurants & leisure) | 10,286 | 444 | |||||||
* | Sprouts Farmers Market, Inc. (Food & staples retailing) | 11,080 | 376 | ||||||
* | Team Health Holdings, Inc. (Health care providers & services) | 5,504 | 317 | ||||||
Texas Roadhouse, Inc. (Hotels, restaurants & leisure) | 10,649 | 360 | |||||||
The Corporate Executive Board Co. (Professional services) | 5,557 | 403 | |||||||
* | The Middleby Corporation (Machinery) | 5,212 | 517 | ||||||
The Toro Co. (Machinery) | 7,247 | 462 | |||||||
* | Tyler Technologies, Inc. (Software) | 5,185 | 567 | ||||||
UniFirst Corporation (Commercial services & supplies) | 4,854 | 590 | |||||||
US Ecology, Inc. (Commercial services & supplies) | 6,753 | 271 | |||||||
Vail Resorts, Inc. (Hotels, restaurants & leisure) | 3,223 | 294 | |||||||
* | WageWorks, Inc. (Professional services) | 6,693 | 432 | ||||||
* | Wayfair, Inc. Class “A” (Internet & catalog retail) | 13,016 | 258 | ||||||
* | Zeltiq Aesthetics, Inc. (Health care equipment & supplies) | 15,594 | 435 | ||||||
18,784 | |||||||||
Europe, Mid-East—19.3% | |||||||||
Austria—0.9% | |||||||||
ams AG (Semiconductors & semiconductor equipment) | 10,822 | 391 | |||||||
Belgium—0.8% | |||||||||
Melexis N.V. (Semiconductors & semiconductor equipment) | 7,806 | 353 | |||||||
Denmark—0.7% | |||||||||
* | Royal Unibrew (Beverages) | 1,620 | 284 | ||||||
Finland—0.8% | |||||||||
Huhtamaki OYJ (Containers & packaging) | 12,666 | 333 | |||||||
France—1.3% | |||||||||
Ingenico (Electronic equipment, instruments & components) | 3,032 | 319 | |||||||
* | Innate Pharma S.A. (Biotechnology) | 24,955 | 235 | ||||||
554 |
See accompanying Notes to Financial Statements.
48 | Annual Report | December 31, 2014 |
Global Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Europe, Mid-East—(continued) | |||||||||
Germany—3.8% | |||||||||
Aareal Bank AG (Thrifts & mortgage finance) | 8,324 | $ | 333 | ||||||
Aurelius AG (Capital markets) | 7,402 | 280 | |||||||
CTS Eventim AG & Co KGaA (Media) | 12,707 | 374 | |||||||
KUKA AG (Machinery) | 3,692 | 261 | |||||||
Norma Group SE (Machinery) | 7,805 | 373 | |||||||
1,621 | |||||||||
Ireland—2.2% | |||||||||
Beazley plc (Insurance) | 137,353 | 611 | |||||||
Greencore Group plc (Food products) | 78,928 | 351 | |||||||
962 | |||||||||
Israel—1.6% | |||||||||
Frutarom Industries, Ltd. (Chemicals) | 12,351 | 381 | |||||||
* | Lumenis, Ltd. (Health care equipment & supplies)† | 34,199 | 320 | ||||||
701 | |||||||||
Italy—2.9% | |||||||||
* | Anima Holding SpA (Capital markets) | 56,065 | 282 | ||||||
Brembo SpA (Auto components) | 12,173 | 408 | |||||||
De’Longhi SpA (Household durables) | 15,630 | 282 | |||||||
Moncler SpA (Textiles, apparel & luxury goods) | 21,595 | 289 | |||||||
1,261 | |||||||||
Norway—0.7% | |||||||||
Borregaard ASA (Chemicals) | 39,069 | 289 | |||||||
Sweden—2.8% | |||||||||
Clas Ohlson AB (Specialty retail) | 16,040 | 278 | |||||||
* | Net Entertainment NE AB (Internet software & services) | 11,756 | 396 | ||||||
Nolato AB Class “B” (Industrial conglomerates) | 24,172 | 549 | |||||||
1,223 | |||||||||
Switzerland—0.8% | |||||||||
VZ Holding AG (Capital markets) | 1,985 | 355 | |||||||
Emerging Asia—10.0% | |||||||||
China—2.4% | |||||||||
* | Hollysys Automation Technologies, Ltd. (Electronic equipment, instruments & components)† | 10,938 | 267 | ||||||
* | Luye Pharma Group, Ltd. (Pharmaceuticals) | 246,000 | 314 | ||||||
* | Ozner Water International Holding Ltd.—144A (Household durables) | 562,000 | 216 | ||||||
* | PAX Global Technology, Ltd. (Electronic equipment, instruments & components) | 237,000 | 243 | ||||||
1,040 | |||||||||
India—3.9% | |||||||||
Alembic Pharmaceuticals, Ltd. (Pharmaceuticals) | 41,949 | 294 | |||||||
Amara Raja Batteries, Ltd. (Electrical equipment) | 23,532 | 307 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
India—(continued) | |||||||||
Apollo Tyres, Ltd. (Auto components) | 75,890 | $ | 268 | ||||||
Kaveri Seed Co., Ltd. (Food products) | 18,891 | 230 | |||||||
Torrent Pharmaceuticals, Ltd. (Pharmaceuticals) | 15,951 | 285 | |||||||
Yes Bank, Ltd. (Banks) | 24,153 | 293 | |||||||
1,677 | |||||||||
Malaysia—0.6% | |||||||||
Silverlake Axis, Ltd. (Software) | 297,000 | 280 | |||||||
Philippines—1.2% | |||||||||
Security Bank Corporation (Banks) | 159,080 | 539 | |||||||
Taiwan—1.2% | |||||||||
King Slide Works Co., Ltd. (Machinery) | 39,000 | 497 | |||||||
Thailand—0.7% | |||||||||
Supalai PCL (Real estate management & development) | 391,600 | 285 | |||||||
Japan—9.0% | |||||||||
Haseko Corporation (Household durables) | 36,300 | 292 | |||||||
Kanamoto Co., Ltd. (Trading companies & distributors) | 9,400 | 254 | |||||||
M3, Inc. (Health care technology) | 15,600 | 261 | |||||||
Meitec Corporation (Professional services) | 10,600 | 313 | |||||||
Nihon Kohden Corporation (Health care equipment & supplies) | 5,200 | 256 | |||||||
Nihon M&A Center, Inc. (Professional services) | 9,800 | 295 | |||||||
Nippon Prologis REIT, Inc. (Real estate investment trusts (REITs)) | 132 | 287 | |||||||
Nissan Chemical Industries, Ltd. (Chemicals) | 17,100 | 310 | |||||||
Obic Co., Ltd. (IT services) | 9,500 | 308 | |||||||
Okabe Co., Ltd. (Building products) | 19,100 | 174 | |||||||
Relo Holdings, Inc. (Real estate management & development) | 4,400 | 315 | |||||||
Sato Holdings Corporation (Commercial services & supplies) | 11,300 | 257 | |||||||
Tsubakimoto Chain Co. (Machinery) | 33,000 | 265 | |||||||
Zenkoku Hosho Co., Ltd. (Diversified financial services) | 10,400 | 295 | |||||||
3,882 | |||||||||
United Kingdom—5.1% | |||||||||
Domino’s Pizza Group plc (Hotels, restaurants & leisure) | 30,641 | 335 | |||||||
Hays plc (Professional services) | 137,884 | 310 | |||||||
Howden Joinery Group plc (Specialty retail) | 51,183 | 319 | |||||||
IG Group Holdings plc (Diversified financial services) | 2,620 | 29 | |||||||
M&C Saatchi plc (Media) | 57,554 | 296 | |||||||
Scapa Group plc (Chemicals) | 135,006 | 282 | |||||||
Ted Baker plc (Textiles, apparel & luxury goods) | 8,579 | 295 | |||||||
Workspace Group plc (Real estate investment trusts (REITs)) | 26,485 | 313 | |||||||
2,179 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 49 |
Global Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Shares or | |||||||||
Principal | |||||||||
Issuer | Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Europe, Mid-East, Africa—2.6% | |||||||||
South Africa—1.4% | |||||||||
Clicks Group, Ltd. (Food & staples retailing) | 38,574 | $ | 270 | ||||||
Coronation Fund Managers, Ltd. (Capital markets) | 33,885 | 335 | |||||||
605 | |||||||||
Turkey—0.6% | |||||||||
Turkiye Sinai Kalkinma Bankasi A.S. (Banks) | 301,811 | 260 | |||||||
United Arab Emirates—0.6% | |||||||||
Al Noor Hospitals Group plc (Health care providers & services) | 17,526 | 270 | |||||||
Emerging Latin America—2.5% | |||||||||
Brazil—0.6% | |||||||||
GAEC Educacao S.A. (Diversified consumer services) | 20,500 | 271 | |||||||
Mexico—1.9% | |||||||||
* | Compartamos S.A.B. de C.V. (Consumer finance) | 286,600 | 576 | ||||||
Credito Real S.A.B. de C.V. (Consumer finance) | 105,995 | 227 | |||||||
803 | |||||||||
Asia—2.0% | |||||||||
Australia—1.4% | |||||||||
DuluxGroup, Ltd. (Chemicals) | 55,511 | 261 | |||||||
Magellan Financial Group, Ltd. (Capital markets) | 25,074 | 334 | |||||||
595 | |||||||||
New Zealand—0.6% | |||||||||
SKY Network Television, Ltd. (Media) | 54,334 | 255 | |||||||
Total Common Stocks—97.2% (cost $39,810) | 41,913 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $1,188, collateralized by U.S. Treasury Note, 2.375%, due 08/15/24 | $ | 1,188 | 1,188 | ||||||
Total Repurchase Agreement—2.7% (cost $1,188) | 1,188 | ||||||||
Total Investments—99.9% (cost $40,998) | 43,101 | ||||||||
Cash and other assets, less liabilities—0.1% | 27 | ||||||||
Net assets—100.0% | $ | 43,128 |
* | Non-income producing securities |
† | = U.S. listed foreign security |
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Consumer Discretionary | 21.1 | % | |||
Industrials | 19.2 | % | |||
Financials | 17.2 | % | |||
Information Technology | 16.3 | % | |||
Health Care | 14.8 | % | |||
Materials | 4.4 | % | |||
Consumer Staples | 3.6 | % | |||
Energy | 3.4 | % | |||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
U.S. Dollar | 46.2 | % | |||
Euro | 9.8 | % | |||
Japanese Yen | 9.3 | % | |||
British Pound Sterling | 8.1 | % | |||
Indian Rupee | 4.0 | % | |||
Canadian Dollar | 3.3 | % | |||
Swedish Krona | 2.9 | % | |||
Mexican Peso | 1.9 | % | |||
Hong Kong Dollar | 1.9 | % | |||
Swiss Franc | 1.8 | % | |||
South African Rand | 1.4 | % | |||
Australian Dollar | 1.4 | % | |||
Philippine Peso | 1.3 | % | |||
New Taiwan Dollar | 1.2 | % | |||
All Other Currencies | 5.5 | % | |||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
50 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 51 |
International Leaders Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 |
1 Year | Since Inception | |||||||
Class N(a) | (2.67 | )% | 9.84 | % | ||||
Class I(a) | (2.43 | ) | 10.13 | |||||
MSCI ACW Ex-U.S. IMI (net)(a) | (3.89 | ) | 8.38 | |||||
Institutional Class(b) | (2.34 | ) | 10.12 | |||||
MSCI ACW Ex-U.S. IMI (net)(b) | (3.89 | ) | 7.35 |
(a) | Since inception is for the period from August 16, 2012 (Commencement of Operations) to December 31, 2014. |
(b) | Since inception is for the period from November 2, 2012 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company L.L.C. without a sales load or distribution (12b-1) fees. Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) All Country World (ACW) Ex-U.S. Investable Market Index (IMI) (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets, excluding the United States. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
52 | Annual Report | December 31, 2014 |
International Leaders Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Europe, Mid-East—35.2% | |||||||||
Denmark—3.4% | |||||||||
Coloplast A/S Class “B” (Health care equipment & supplies) | 18,249 | $ | 1,527 | ||||||
Novo Nordisk A/S Class “B” (Pharmaceuticals) | 34,654 | 1,466 | |||||||
2,993 | |||||||||
Finland—1.8% | |||||||||
Sampo Oyj Class “A” (Insurance) | 33,454 | 1,566 | |||||||
France—4.6% | |||||||||
Cap Gemini S.A. (IT services) | 24,934 | 1,783 | |||||||
Total S.A. (Oil, gas & consumable fuels) | 26,338 | 1,349 | |||||||
Valeo S.A. (Auto components) | 7,607 | 947 | |||||||
4,079 | |||||||||
Germany—4.1% | |||||||||
Bayerische Motoren Werke AG (Automobiles) | 13,187 | 1,423 | |||||||
Continental AG (Auto components) | 7,576 | 1,598 | |||||||
Rational AG (Machinery) | 1,928 | 604 | |||||||
3,625 | |||||||||
Ireland—1.8% | |||||||||
* | Ryanair Holdings plc—ADR (Airlines) | 22,113 | 1,576 | ||||||
Israel—3.8% | |||||||||
* | Check Point Software Technologies, Ltd. (Software)† | 15,517 | 1,219 | ||||||
Teva Pharmaceutical Industries, Ltd.—ADR (Pharmaceuticals) | 37,326 | 2,147 | |||||||
3,366 | |||||||||
Italy—2.1% | |||||||||
Intesa Sanpaolo SpA (Banks) | 626,254 | 1,817 | |||||||
Netherlands—2.1% | |||||||||
* | NXP Semiconductor N.V. (Semiconductors & semiconductor equipment)† | 13,062 | 998 | ||||||
Royal Dutch Shell plc (Oil, gas & consumable fuels) | 25,616 | 854 | |||||||
1,852 | |||||||||
Norway—1.1% | |||||||||
Telenor ASA (Diversified telecommunication services) | 48,775 | 987 | |||||||
Spain—1.4% | |||||||||
Amadeus IT Holding S.A. Class “A” (IT services) | 30,714 | 1,223 | |||||||
Sweden—2.1% | |||||||||
Atlas Copco AB Class “A” (Machinery) | 52,239 | 1,454 | |||||||
Hexagon AB Class “B” (Electronic equipment, instruments & components) | 11,881 | 366 | |||||||
1,820 | |||||||||
Switzerland—6.9% | |||||||||
* | Actelion, Ltd. (Biotechnology) | 11,700 | 1,347 | ||||||
* | Adecco S.A. (Professional services) | 10,891 | 749 | ||||||
Geberit AG (Building products) | 4,815 | 1,629 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Europe, Mid-East—(continued) | |||||||||
Switzerland—(continued) | |||||||||
Partners Group Holding AG (Capital markets) | 5,289 | $ | 1,539 | ||||||
Roche Holding AG (Pharmaceuticals) | 2,278 | 617 | |||||||
Sika AG (Chemicals) | 51 | 150 | |||||||
6,031 | |||||||||
Japan—21.7% | |||||||||
Astellas Pharma, Inc. (Pharmaceuticals) | 122,800 | 1,710 | |||||||
Daikin Industries, Ltd. (Building products) | 27,000 | 1,731 | |||||||
Daito Trust Construction Co., Ltd. (Real estate management & development) | 7,400 | 839 | |||||||
Fanuc Corporation (Machinery) | 9,200 | 1,517 | |||||||
Fuji Heavy Industries, Ltd. (Automobiles) | 48,459 | 1,715 | |||||||
Hoya Corporation (Electronic equipment, instruments & components) | 36,200 | 1,224 | |||||||
Kao Corporation (Personal products) | 37,100 | 1,463 | |||||||
Keyence Corporation (Electronic equipment, instruments & components) | 3,100 | 1,381 | |||||||
Murata Manufacturing Co., Ltd. (Electronic equipment, instruments & components) | 10,100 | 1,102 | |||||||
Nitori Holdings Co., Ltd. (Specialty retail) | 15,400 | 827 | |||||||
ORIX Corporation (Diversified financial services) | 114,400 | 1,440 | |||||||
* | Recruit Holdings Co., Ltd. (Professional services) | 9,000 | 259 | ||||||
Secom Co., Ltd. (Commercial services & supplies) | 19,500 | 1,120 | |||||||
SMC Corporation (Machinery) | 4,500 | 1,180 | |||||||
Sumitomo Mitsui Financial Group, Inc. (Banks) | 43,500 | 1,573 | |||||||
19,081 | |||||||||
Emerging Asia—15.3% | |||||||||
China—7.5% | |||||||||
* | Alibaba Group Holding, Ltd.—ADR | ||||||||
(Internet software & services) | 10,201 | 1,060 | |||||||
* | Baidu, Inc.—ADR (Internet software & services) | 5,578 | 1,272 | ||||||
China Overseas Land & Investment, Ltd. | |||||||||
(Real estate management & development) | 308,000 | 913 | |||||||
Lenovo Group, Ltd. (Technology hardware, storage & peripherals) | 984,000 | 1,292 | |||||||
NetEase, Inc.—ADR (Internet software & services) | 8,954 | 888 | |||||||
Tencent Holdings, Ltd. (Internet software & services) | 84,100 | 1,217 | |||||||
6,642 | |||||||||
India—4.9% | |||||||||
Hero MotoCorp, Ltd. (Automobiles) | 33,076 | 1,619 | |||||||
Housing Development Finance Corporation (Thrifts & mortgage finance) | 59,957 | 1,072 | |||||||
Tata Motors, Ltd.—ADR (Automobiles) | 37,668 | 1,593 | |||||||
4,284 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 53 |
International Leaders Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
Indonesia—1.9% | |||||||||
PT Bank Rakyat Indonesia Persero Tbk | |||||||||
(Banks) | 1,775,100 | $ | 1,669 | ||||||
Taiwan—1.0% | |||||||||
MediaTek, Inc. (Semiconductors & semiconductor equipment) | 63,000 | 916 | |||||||
United Kingdom—12.6% | |||||||||
ARM Holdings plc (Semiconductors & semiconductor equipment) | 28,184 | 433 | |||||||
AstraZeneca plc (Pharmaceuticals) | 15,216 | 1,075 | |||||||
BG Group plc (Oil, gas & consumable fuels) | 56,273 | 753 | |||||||
Compass Group plc (Hotels, restaurants & leisure) | 142,758 | 2,440 | |||||||
InterContinental Hotels Group plc (Hotels, restaurants & leisure) | 32,399 | 1,304 | |||||||
Reckitt Benckiser Group plc (Household products) | 6,030 | 488 | |||||||
Reed Elsevier plc (Media) | 106,907 | 1,826 | |||||||
St James’s Place plc (Insurance) | 105,007 | 1,324 | |||||||
Wolseley plc (Trading companies & distributors) | 1,521 | 87 | |||||||
WPP plc (Media) | 66,247 | 1,377 | |||||||
11,107 | |||||||||
Canada—7.4% | |||||||||
Alimentation Couche Tard, Inc. Class “B” (Food & staples retailing) | 48,843 | 2,047 | |||||||
Brookfield Asset Management, Inc. Class “A” (Real estate management & development)† | 42,456 | 2,128 | |||||||
CI Financial Corporation (Capital markets) | 34,710 | 965 | |||||||
Suncor Energy, Inc. (Oil, gas & consumable fuels) | 43,700 | 1,388 | |||||||
6,528 | |||||||||
Emerging Europe, Mid-East, Africa—2.9% | |||||||||
South Africa—2.9% | |||||||||
Bidvest Group, Ltd. (Industrial conglomerates) | 42,650 | 1,115 | |||||||
Discovery, Ltd. (Insurance) | 146,871 | 1,406 | |||||||
2,521 | |||||||||
Asia—2.8% | |||||||||
Hong Kong—2.8% | |||||||||
AIA Group, Ltd. (Insurance) | 274,600 | 1,509 | |||||||
MGM China Holdings, Ltd. (Hotels, restaurants & leisure) | 376,400 | 951 | |||||||
2,460 | |||||||||
Emerging Latin America—0.8% | |||||||||
Brazil—0.8% | |||||||||
Kroton Educacional S.A. (Diversified consumer services) | 118,800 | 692 | |||||||
Total Common Stocks—98.7% (cost $80,976) | 86,835 |
Principal | |||||||||
Issuer | Amount | Value | |||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $1,050, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 1,050 | $ | 1,050 | |||||
Total Repurchase Agreement—1.2% (cost $1,050) | 1,050 | ||||||||
Total Investments—99.9% (cost $82,026) | 87,885 | ||||||||
Cash and other assets, less liabilities—0.1% | 77 | ||||||||
Net assets—100.0% | $ | 87,962 |
ADR = American Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 22.7 | % | ||
Consumer Discretionary | 21.1 | % | ||
Information Technology | 18.9 | % | ||
Industrials | 15.0 | % | ||
Health Care | 11.4 | % | ||
Energy | 5.0 | % | ||
Consumer Staples | 4.6 | % | ||
Telecommunication Services | 1.1 | % | ||
Materials | 0.2 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
Japanese Yen | 22.0 | % | ||
Euro | 15.2 | % | ||
U.S. Dollar | 14.8 | % | ||
British Pound Sterling | 12.8 | % | ||
Swiss Franc | 6.9 | % | ||
Hong Kong Dollar | 6.8 | % | ||
Canadian Dollar | 5.1 | % | ||
Danish Krone | 3.4 | % | ||
Indian Rupee | 3.1 | % | ||
South African Rand | 2.9 | % | ||
Swedish Krona | 2.1 | % | ||
Indonesian Rupiah | 1.9 | % | ||
Norwegian Krone | 1.1 | % | ||
New Taiwan Dollar | 1.1 | % | ||
All Other Currencies | 0.8 | % | ||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
54 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 55 |
International Equity Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | (3.09 | )% | 10.83 | % | 5.64 | % | 3.67 | % | ||||||||
Class I | (2.80 | ) | 11.12 | 5.90 | 3.92 | |||||||||||
MSCI World Ex-U.S. Index (net) | (4.32 | ) | 10.47 | 5.21 | 4.64 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company L.L.C. without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) World Ex-U.S. Index (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets, excluding the United States. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
56 | Annual Report | December 31, 2014 |
International Equity Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Europe—32.5% | |||||||||
Belgium—1.2% | |||||||||
UCB S.A. (Pharmaceuticals) | 10,518 | $ | 800 | ||||||
Denmark—2.2% | |||||||||
Coloplast A/S Class “B” (Health care equipment & supplies) | 10,596 | 887 | |||||||
Novo Nordisk A/S Class “B” (Pharmaceuticals) | 13,997 | 592 | |||||||
1,479 | |||||||||
France—3.6% | |||||||||
Cap Gemini S.A. (IT services) | 12,015 | 859 | |||||||
Essilor International S.A. (Health care equipment & supplies) | 6,806 | 759 | |||||||
Total S.A. (Oil, gas & consumable fuels) | 16,249 | 833 | |||||||
2,451 | |||||||||
Germany—6.4% | |||||||||
BASF SE (Chemicals) | 11,884 | 997 | |||||||
Bayer AG (Pharmaceuticals) | 4,962 | 676 | |||||||
Bayerische Motoren Werke AG (Automobiles) | 9,033 | 975 | |||||||
Continental AG (Auto components) | 4,283 | 903 | |||||||
Infineon Technologies AG (Semiconductors & semiconductor equipment) | 75,733 | 802 | |||||||
4,353 | |||||||||
Ireland—1.0% | |||||||||
Shire plc (Pharmaceuticals) | 9,907 | 702 | |||||||
Italy—1.0% | |||||||||
Intesa Sanpaolo SpA (Banks) | 246,853 | 716 | |||||||
Netherlands—3.2% | |||||||||
* | NXP Semiconductor N.V. (Semiconductors & semiconductor equipment)† | 9,995 | 764 | ||||||
* | Sensata Technologies Holding N.V. (Electrical equipment)† | 14,149 | 741 | ||||||
Unilever N.V. (Food products) | 18,185 | 711 | |||||||
2,216 | |||||||||
Sweden—5.9% | |||||||||
Assa Abloy AB Class “B” (Building products) | 16,742 | 884 | |||||||
Atlas Copco AB Class “A” (Machinery) | 46,113 | 1,283 | |||||||
Hexagon AB Class “B” (Electronic equipment, instruments & components) | 18,669 | 576 | |||||||
Swedbank AB Class “A” (Banks) | 52,260 | 1,297 | |||||||
4,040 | |||||||||
Switzerland—8.0% | |||||||||
Geberit AG (Building products) | 2,743 | 928 | |||||||
Nestle S.A. (Food products) | 14,160 | 1,032 | |||||||
Novartis AG (Pharmaceuticals) | 18,273 | 1,695 | |||||||
Roche Holding AG (Pharmaceuticals) | 4,193 | 1,136 | |||||||
Sonova Holding AG (Health care equipment & supplies) | 4,818 | 708 | |||||||
5,499 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
United Kingdom—25.5% | |||||||||
Babcock International Group plc | |||||||||
(Commercial services & supplies) | 61,608 | $ | 1,009 | ||||||
Capita plc (Professional services) | 49,639 | 832 | |||||||
Compass Group plc (Hotels, restaurants & leisure) | 107,890 | 1,844 | |||||||
easyJet plc (Airlines) | 48,405 | 1,253 | |||||||
Experian plc (Professional services) | 59,788 | 1,008 | |||||||
InterContinental Hotels Group plc (Hotels, restaurants & leisure) | 20,895 | 841 | |||||||
Next plc (Multiline retail) | 4,758 | 505 | |||||||
Prudential plc (Insurance) | 59,889 | 1,385 | |||||||
Reckitt Benckiser Group plc (Household products) | 10,639 | 862 | |||||||
Reed Elsevier plc (Media) | 53,939 | 921 | |||||||
Regus plc (Commercial services & supplies) | 243,361 | 786 | |||||||
Rio Tinto plc (Metals & mining) | 18,369 | 847 | |||||||
Schroders plc (Capital markets) | 17,797 | 740 | |||||||
Smith & Nephew plc (Health care equipment & supplies) | 31,350 | 565 | |||||||
SSE plc (Electric utilities) | 28,195 | 712 | |||||||
Standard Life plc (Insurance) | 92,034 | 570 | |||||||
Travis Perkins plc (Trading companies & distributors) | 41,393 | 1,191 | |||||||
Tullow Oil plc (Oil, gas & consumable fuels) | 77,418 | 499 | |||||||
Wolseley plc (Trading companies & distributors) | 19,252 | 1,101 | |||||||
17,471 | |||||||||
Japan—19.0% | |||||||||
Astellas Pharma, Inc. (Pharmaceuticals) | 59,062 | 822 | |||||||
Daikin Industries, Ltd. (Building products) | 9,594 | 615 | |||||||
Daito Trust Construction Co., Ltd. (Real estate management & development) | 4,300 | 488 | |||||||
Fanuc Corporation (Machinery) | 4,900 | 808 | |||||||
Hoya Corporation (Electronic equipment, instruments & components) | 27,200 | 920 | |||||||
Japan Exchange Group, Inc. (Diversified financial services) | 21,100 | 492 | |||||||
Kao Corporation (Personal products) | 20,500 | 808 | |||||||
Keyence Corporation (Electronic equipment, instruments & components) | 1,400 | 624 | |||||||
Nidec Corporation (Electrical equipment) | 10,213 | 660 | |||||||
Nihon M&A Center, Inc. (Professional services) | 15,700 | 473 | |||||||
Nippon Prologis REIT, Inc. (Real estate investment trusts (REITs)) | 445 | 966 | |||||||
Obic Co., Ltd. (IT services) | 22,400 | 727 | |||||||
ORIX Corporation (Diversified financial services) | 64,885 | 816 | |||||||
SCSK Corporation (IT services) | 23,583 | 591 | |||||||
Seino Holdings Co., Ltd. (Road & rail) | 61,174 | 617 | |||||||
Sumitomo Mitsui Trust Holdings, Inc. (Banks) | 212,000 | 812 | |||||||
Sumitomo Realty & Development Co., Ltd. (Real estate management & development) | 18,000 | 613 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 57 |
International Equity Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Japan—(continued) | |||||||||
Suruga Bank, Ltd. (Banks) | 25,732 | $ | 473 | ||||||
Trend Micro, Inc. (Software) | 25,600 | 707 | |||||||
13,032 | |||||||||
Canada—9.1% | |||||||||
Alimentation Couche Tard, Inc. Class “B” (Food & staples retailing) | 20,581 | 863 | |||||||
Brookfield Asset Management, Inc. Class “A” (Real estate management & development)† | 18,421 | 923 | |||||||
Canadian National Railway Co. (Road & rail)† | 17,531 | 1,208 | |||||||
Canadian Natural Resources, Ltd. (Oil, gas & consumable fuels) | 30,430 | 941 | |||||||
CI Financial Corporation (Capital markets) | 22,952 | 638 | |||||||
Suncor Energy, Inc. (Oil, gas & consumable fuels) | 23,500 | 746 | |||||||
The Toronto-Dominion Bank (Banks)† | 19,550 | 934 | |||||||
6,253 | |||||||||
Emerging Asia—8.8% | |||||||||
China—3.5% | |||||||||
China Everbright International, Ltd. (Commercial services & supplies) | 453,963 | 676 | |||||||
China Overseas Land & Investment, Ltd. (Real estate management & development) | 304,000 | 901 | |||||||
CNOOC, Ltd. (Oil, gas & consumable fuels) | 618,992 | 837 | |||||||
2,414 | |||||||||
India—2.8% | |||||||||
HDFC Bank, Ltd.—ADR (Banks) | 21,684 | 1,100 | |||||||
Tata Consultancy Services, Ltd. (IT services) | 19,676 | 799 | |||||||
1,899 | |||||||||
Papua New Guinea—0.6% | |||||||||
Oil Search, Ltd. (Oil, gas & consumable fuels) | 64,214 | 412 | |||||||
Taiwan—1.9% | |||||||||
Compal Electronics, Inc. (Technology hardware, storage & peripherals) | 1,032,000 | 721 | |||||||
Largan Precision Co., Ltd. (Electronic equipment, instruments & components) | 8,000 | 599 | |||||||
1,320 | |||||||||
Asia—1.9% | |||||||||
Hong Kong—1.9% | |||||||||
AIA Group, Ltd. (Insurance) | 230,929 | 1,269 | |||||||
Emerging Latin America—0.6% | |||||||||
Panama—0.6% | |||||||||
Copa Holdings S.A. Class “A” (Airlines)† | 3,648 | 378 | |||||||
Total Common Stocks—97.4% (cost $60,167) | 66,704 |
Principal | |||||||||
Issuer | Amount | Value | |||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $161, collateralized by U.S. Treasury Notes, 2.375%, due 08/15/24 | $ | 161 | $ | 161 | |||||
Total Repurchase Agreement—0.2% (cost $161) | 161 | ||||||||
Total Investments—97.6% (cost $60,328) | 66,865 | ||||||||
Cash and other assets, less liabilities—2.4% | 1,644 | ||||||||
Net assets—100.0% | $ | 68,509 |
ADR = American Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Industrials | 24.6 | % | ||
Financials | 22.7 | % | ||
Health Care | 14.0 | % | ||
Information Technology | 13.0 | % | ||
Consumer Discretionary | 9.0 | % | ||
Consumer Staples | 6.4 | % | ||
Energy | 6.4 | % | ||
Materials | 2.8 | % | ||
Utilities | 1.1 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
British Pound Sterling | 27.3 | % | ||
Japanese Yen | 19.5 | % | ||
Euro | 13.5 | % | ||
U.S. Dollar | 9.1 | % | ||
Swiss Franc | 8.2 | % | ||
Swedish Krona | 6.1 | % | ||
Hong Kong Dollar | 5.5 | % | ||
Canadian Dollar | 4.8 | % | ||
Danish Krone | 2.2 | % | ||
New Taiwan Dollar | 2.0 | % | ||
Indian Rupee | 1.2 | % | ||
All Other Currencies | 0.6 | % | ||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
58 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 59 |
Institutional International Equity Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Institutional Class | (3.50 | )% | 10.99 | % | 5.95 | % | 4.21 | % | ||||||||
MSCI World Ex-U.S. Index (net) | (4.32 | ) | 10.47 | 5.21 | 4.64 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Shares of the Fund are available without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) World Ex-U.S. Index (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets, excluding the United States. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
60 | Annual Report | December 31, 2014 |
Institutional International Equity Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Europe—32.5% | |||||||||
Belgium—1.2% | |||||||||
UCB S.A. (Pharmaceuticals) | 2,235 | $ | 170 | ||||||
Denmark—2.2% | |||||||||
Coloplast A/S Class “B” (Health care equipment & supplies) | 2,251 | 188 | |||||||
Novo Nordisk A/S Class “B” (Pharmaceuticals) | 2,974 | 126 | |||||||
314 | |||||||||
France—3.6% | |||||||||
Cap Gemini S.A. (IT services) | 2,553 | 183 | |||||||
Essilor International S.A. (Health care equipment & supplies) | 1,446 | 161 | |||||||
Total S.A. (Oil, gas & consumable fuels) | 3,453 | 177 | |||||||
521 | |||||||||
Germany—6.4% | |||||||||
BASF SE (Chemicals) | 2,525 | 212 | |||||||
Bayer AG (Pharmaceuticals) | 1,056 | 144 | |||||||
Bayerische Motoren Werke AG (Automobiles) | 1,919 | 207 | |||||||
Continental AG (Auto components) | 910 | 192 | |||||||
Infineon Technologies AG (Semiconductors & semiconductor equipment) | 16,093 | 170 | |||||||
925 | |||||||||
Ireland—1.0% | |||||||||
Shire plc (Pharmaceuticals) | 2,107 | 149 | |||||||
Italy—1.0% | |||||||||
Intesa Sanpaolo SpA (Banks) | 52,553 | 152 | |||||||
Netherlands—3.2% | |||||||||
* | NXP Semiconductor N.V. (Semiconductors & semiconductor equipment)† | 2,124 | 162 | ||||||
* | Sensata Technologies Holding N.V. (Electrical equipment)† | 3,007 | 158 | ||||||
Unilever N.V. (Food products) | 3,864 | 151 | |||||||
471 | |||||||||
Sweden—5.9% | |||||||||
Assa Abloy AB Class “B” (Building products) | 3,558 | 188 | |||||||
Atlas Copco AB Class “A” (Machinery) | 9,799 | 273 | |||||||
Hexagon AB (Electronic equipment, instruments & components) | 3,967 | 122 | |||||||
Swedbank AB Class “A” (Banks) | 11,105 | 276 | |||||||
859 | |||||||||
Switzerland—8.0% | |||||||||
Geberit AG (Building products) | 583 | 197 | |||||||
Nestle S.A. (Food products) | 3,009 | 219 | |||||||
Novartis AG (Pharmaceuticals) | 3,883 | 360 | |||||||
Roche Holding AG (Pharmaceuticals) | 891 | 242 | |||||||
Sonova Holding AG (Health care equipment & supplies) | 1,024 | 151 | |||||||
1,169 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
United Kingdom—25.5% | |||||||||
Babcock International Group plc (Commercial services & supplies) | 13,092 | $ | 215 | ||||||
Capita plc (Professional services) | 10,548 | 177 | |||||||
Compass Group plc (Hotels, restaurants & leisure) | 22,926 | 392 | |||||||
easyJet plc (Airlines) | 10,286 | 266 | |||||||
Experian plc (Professional services) | 12,705 | 214 | |||||||
InterContinental Hotels Group plc (Hotels, restaurants & leisure) | 4,440 | 179 | |||||||
Next plc (Multiline retail) | 1,011 | 107 | |||||||
Prudential plc (Insurance) | 12,726 | 294 | |||||||
Reckitt Benckiser Group plc (Household products) | 2,261 | 183 | |||||||
Reed Elsevier plc (Media) | 11,462 | 196 | |||||||
Regus plc (Commercial services & supplies) | 51,713 | 167 | |||||||
Rio Tinto plc (Metals & mining) | 3,903 | 180 | |||||||
Schroders plc (Capital markets) | 3,782 | 157 | |||||||
Smith & Nephew plc (Health care equipment & supplies) | 6,667 | 120 | |||||||
SSC plc (Electric utilities) | 5,991 | 151 | |||||||
Standard Life plc (Insurance) | 19,557 | 121 | |||||||
Travis Perkins plc (Trading companies & distributors) | 8,796 | 253 | |||||||
Tullow Oil plc (Oil, gas & consumable fuels) | 16,451 | 106 | |||||||
Wolseley plc (Trading companies & distributors) | 4,091 | 234 | |||||||
3,712 | |||||||||
Japan—18.9% | |||||||||
Astellas Pharma, Inc. (Pharmaceuticals) | 12,538 | 175 | |||||||
Daikin Industries, Ltd. (Building products) | 2,006 | 129 | |||||||
Daito Trust Construction Co., Ltd. (Real estate management & development) | 900 | 102 | |||||||
Fanuc Corporation (Machinery) | 1,000 | 165 | |||||||
Hoya Corporation (Electronic equipment, instruments & components) | 5,800 | 196 | |||||||
Japan Exchange Group, Inc. (Diversified financial services) | 4,500 | 105 | |||||||
Kao Corporation (Personal products) | 4,300 | 170 | |||||||
Keyence Corporation (Electronic equipment, instruments & components) | 300 | 134 | |||||||
Nidec Corporation (Electrical equipment) | 2,187 | 141 | |||||||
Nihon M&A Center, Inc. (Professional services) | 3,300 | 99 | |||||||
Nippon Prologis REIT, Inc. (Real estate investment trusts (REITs)) | 94 | 204 | |||||||
Obic Co., Ltd. (IT services) | 4,800 | 156 | |||||||
ORIX Corporation (Diversified financial services) | 13,812 | 174 | |||||||
SCSK Corporation (IT services) | 4,983 | 125 | |||||||
Seino Holdings Co., Ltd. (Road & rail) | 12,826 | 129 | |||||||
Sumitomo Mitsui Trust Holdings, Inc. (Banks) | 45,000 | 172 | |||||||
Sumitomo Realty & Development Co., Ltd. (Real estate management & development) | 4,000 | 136 | |||||||
Suruga Bank, Ltd. (Banks) | 5,268 | 97 | |||||||
Trend Micro, Inc. (Software) | 5,400 | 149 | |||||||
2,758 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 61 |
Institutional International Equity Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Canada—9.1% | |||||||||
Alimentation Couche Tard, Inc. Class “B” (Food & staples retailing) | 4,375 | $ | 183 | ||||||
Brookfield Asset Management, Inc. Class “A” (Real estate management & development)† | 3,914 | 196 | |||||||
Canadian National Railway Co. (Road & rail)† | 3,725 | 257 | |||||||
Canadian Natural Resources, Ltd. (Oil, gas & consumable fuels) | 6,466 | 200 | |||||||
CI Financial Corporation (Capital markets) | 4,877 | 135 | |||||||
Suncor Energy, Inc. (Oil, gas & consumable fuels) | 5,000 | 159 | |||||||
The Toronto-Dominion Bank (Banks)† | 4,156 | 199 | |||||||
1,329 | |||||||||
Emerging Asia—9.0% | |||||||||
China—3.5% | |||||||||
China Everbright International, Ltd. (Commercial services & supplies) | 97,037 | 145 | |||||||
China Overseas Land & Investment, Ltd. (Real estate management & development) | 64,000 | 190 | |||||||
CNOOC, Ltd. (Oil, gas & consumable fuels) | 132,008 | 178 | |||||||
513 | |||||||||
India—2.8% | |||||||||
HDFC Bank, Ltd.—ADR (Banks) | 4,608 | 234 | |||||||
Tata Consultancy Services, Ltd. (IT services) | 4,181 | 169 | |||||||
403 | |||||||||
Papua New Guinea—0.6% | |||||||||
Oil Search, Ltd. (Oil, gas & consumable fuels) | 13,645 | 87 | |||||||
Taiwan—2.1% | |||||||||
Compal Electronics, Inc. (Technology hardware, storage & peripherals) | 219,000 | 153 | |||||||
Largan Precision Co., Ltd. (Electronic equipment, instruments & components) | 2,000 | 150 | |||||||
303 | |||||||||
Asia—1.8% | |||||||||
Hong Kong—1.8% | |||||||||
AIA Group, Ltd. (Insurance) | 49,071 | 270 | |||||||
Emerging Latin America—0.5% | |||||||||
Panama—0.5% | |||||||||
Copa Holdings S.A. Class “A” (Airlines)† | 775 | 80 | |||||||
Total Common Stocks-—97.3% (cost $12,942) | 14,185 |
Principal | |||||||||
Issuer | Amount | Value | |||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $357, collateralized by Federal Farm Credit Bank, 2.700%, due 12/2/24 | $357 | $ | 357 | ||||||
Total Repurchase Agreement—2.5% (cost $357) | 357 | ||||||||
Total Investments—99.8% (cost $13,299) | 14,542 | ||||||||
Cash and other assets, less liabilities—0.2% | 32 | ||||||||
Net assets—100.0% | $ | 14,574 |
ADR = American Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Industrials | 24.4 | % | ||
Financials | 22.7 | % | ||
Health Care | 14.0 | % | ||
Information Technology | 13.2 | % | ||
Consumer Discretionary | 9.0 | % | ||
Energy | 6.4 | % | ||
Consumer Staples | 6.4 | % | ||
Materials | 2.8 | % | ||
Utilities | 1.1 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
British Pound Sterling | 27.2 | % | ||
Japanese Yen | 19.5 | % | ||
Euro | 13.5 | % | ||
U.S. Dollar | 9.1 | % | ||
Swiss Franc | 8.2 | % | ||
Swedish Krona | 6.1 | % | ||
Hong Kong Dollar | 5.5 | % | ||
Canadian Dollar | 4.8 | % | ||
Danish Krone | 2.2 | % | ||
New Taiwan Dollar | 2.1 | % | ||
Indian Rupee | 1.2 | % | ||
All Other Currencies | 0.6 | % | ||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
62 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 63 |
International Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | (3.19 | )% | 12.39 | % | 7.83 | % | 5.74 | % | ||||||||
Class I | (2.86 | ) | 12.72 | 8.16 | 6.06 | |||||||||||
MSCI ACW Ex-U.S. IMI (net) | (3.89 | ) | 9.22 | 4.71 | 5.37 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) All Country World (ACW) Ex-U.S. Investable Market Index (IMI) (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets, excluding the United States. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
64 | Annual Report | December 31, 2014 |
International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Europe, Mid-East—35.2% | |||||||||
Belgium—0.5% | |||||||||
* | Telenet Group Holding N.V. (Media) | 195,213 | $ | 10,955 | |||||
UCB S.A. (Pharmaceuticals) | 110,559 | 8,406 | |||||||
19,361 | |||||||||
Denmark—1.3% | |||||||||
Coloplast A/S Class “B” (Health care equipment & supplies) | 166,195 | 13,908 | |||||||
Novo Nordisk A/S Class “B” (Pharmaceuticals) | 797,210 | 33,722 | |||||||
47,630 | |||||||||
Finland—2.1% | |||||||||
Kone Oyj Class “B” (Machinery) | 440,210 | 20,042 | |||||||
Sampo Oyj Class “A’’ (Insurance) | 1,220,860 | 57,154 | |||||||
77,196 | |||||||||
France—5.3% | |||||||||
AXA S.A. (Insurance) | 1,896,687 | 43,705 | |||||||
BNP Paribas S.A. (Banks) | 626,731 | 36,998 | |||||||
Bollore S.A. (Air freight & logistics) | 919,046 | 4,185 | |||||||
Cap Gemini S.A. (IT services) | 127,163 | 9,094 | |||||||
Essilor International S.A. (Health care equipment & supplies) | 207,163 | 23,103 | |||||||
Hermes International (Textiles, apparel & luxury goods) | 21,424 | 7,629 | |||||||
Ingenico (Electronic equipment, instruments & components) | 57,355 | 6,042 | |||||||
Plastic Omnium S.A. (Auto components) | 194,258 | 5,272 | |||||||
Total S.A. (Oil, gas & consumable fuels) | 454,304 | 23,275 | |||||||
Unibail-Rodamco SE (Real estate investment trusts (REITs)) | 69,895 | 17,931 | |||||||
Valeo S.A. (Auto components) | 154,068 | 19,171 | |||||||
196,405 | |||||||||
Germany—5.6% | |||||||||
BASF SE (Chemicals) | 332,855 | 27,920 | |||||||
Bayer AG (Pharmaceuticals) | 373,985 | 50,977 | |||||||
Bayerische Motoren Werke AG (Automobiles) | 232,149 | 25,053 | |||||||
Brenntag AG (Trading companies & distributors) | 211,376 | 11,818 | |||||||
Continental AG (Auto components) | 165,610 | 34,931 | |||||||
Deutsche Annington Immobilien SE (Real estate management & development) | 203,712 | 6,916 | |||||||
Deutsche Wohnen AG (Real estate management & development) | 258,205 | 6,091 | |||||||
Fielmann AG (Specialty retail) | 85,150 | 5,815 | |||||||
* | Morphosys AG (Life sciences tools & services) | 65,866 | 6,136 | ||||||
ProSiebenSat.1 Media AG (Media) | 435,638 | 18,203 | |||||||
Wirecard AG (IT services) | 308,869 | 13,468 | |||||||
207,328 | |||||||||
Ireland—1.5% | |||||||||
* | ICON plc (Life sciences tools & services)† | 101,104 | 5,155 | ||||||
Shire plc (Pharmaceuticals) | 566,585 | 40,171 | |||||||
Smurfit Kappa Group plc (Containers & packaging) | 415,054 | 9,334 | |||||||
54,660 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Europe, Mid-East—(continued) | |||||||||
Israel—1.7% | |||||||||
* | Check Point Software Technologies, Ltd. (Software)† | 409,588 | $ | 32,181 | |||||
Teva Pharmaceutical Industries, Ltd.—ADR (Pharmaceuticals) | 537,606 | 30,918 | |||||||
63,099 | |||||||||
Italy—1.5% | |||||||||
Banca Generali SpA (Capital markets) | 361,122 | 10,044 | |||||||
Intesa Sanpaolo SpA (Banks) | 15,087,939 | 43,769 | |||||||
53,813 | |||||||||
Luxembourg—0.2% | |||||||||
Eurofins Scientific SE (Life sciences tools & services) | 30,398 | 7,759 | |||||||
Netherlands—0.6% | |||||||||
* | NXP Semiconductor N.V. (Semiconductors & semiconductor equipment)† | 293,441 | 22,419 | ||||||
Norway—1.2% | |||||||||
Gjensidige Forsikring ASA (Insurance) | 320,213 | 5,225 | |||||||
Telenor ASA (Diversified telecommunication services) | 2,004,355 | 40,545 | |||||||
45,770 | |||||||||
Spain—3.0% | |||||||||
Abertis Infraestructuras S.A. (Transportation infrastructure) | 645,376 | 12,798 | |||||||
Amadeus IT Holding S.A. Class “A” (IT services) | 726,726 | 28,943 | |||||||
Banco Bilbao Vizcaya Argentaria S.A. (Banks) | 1,682,799 | 15,893 | |||||||
Bankinter S.A. (Banks) | 2,218,506 | 17,823 | |||||||
Mapfre S.A. (Insurance) | 1,604,803 | 5,424 | |||||||
Repsol S.A. (Oil, gas & consumable fuels) | 1,502,755 | 28,133 | |||||||
109,014 | |||||||||
Sweden—2.8% | |||||||||
Assa Abloy AB Class “B” (Building products) | 142,606 | 7,532 | |||||||
Atlas Copco AB Class “A” (Machinery) | 1,029,628 | 28,650 | |||||||
Hennes & Mauritz AB Class “B” (Specialty retail) | 304,950 | 12,669 | |||||||
Hexagon AB Class “B” (Electronic equipment, instruments & components) | 279,844 | 8,633 | |||||||
Hexpol AB (Chemicals) | 59,454 | 5,595 | |||||||
Intrum Justitia AB (Commercial services & supplies) | 184,882 | 5,476 | |||||||
Swedbank AB Class “A” (Banks) | 1,392,654 | 34,553 | |||||||
103,108 | |||||||||
Switzerland—7.9% | |||||||||
* | Actelion, Ltd. (Biotechnology) | 196,936 | 22,671 | ||||||
* | Adecco S.A. (Professional services) | 180,504 | 12,408 | ||||||
* | Clariant AG (Chemicals) | 914,661 | 15,327 | ||||||
Geberit AG (Building products) | 47,185 | 15,963 | |||||||
* | Glencore plc (Metals & mining) | 12,267,776 | 56,626 | ||||||
Nestle S.A. (Food products) | 469,126 | 34,200 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 65 |
International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Europe, Mid-East—(continued) | |||||||||
Switzerland—(continued) | |||||||||
Novartis AG (Pharmaceuticals) | 486,406 | $ | 45,111 | ||||||
Partners Group Holding AG (Capital markets) | 85,630 | 24,913 | |||||||
Roche Holding AG (Pharmaceuticals) | 149,320 | 40,457 | |||||||
Sonova Holding AG (Health care equipment & supplies) | 96,215 | 14,135 | |||||||
Straumann Holding AG (Health care equipment & supplies) | 28,260 | 7,100 | |||||||
288,911 | |||||||||
Japan—18.2% | |||||||||
Asahi Group Holdings, Ltd. (Beverages) | 365,200 | 11,298 | |||||||
Asahi Kasei Corporation (Chemicals) | 3,487,000 | 31,810 | |||||||
Astellas Pharma, Inc. (Pharmaceuticals) | 3,145,000 | 43,786 | |||||||
Daikin Industries, Ltd. (Building products) | 471,300 | 30,222 | |||||||
Daito Trust Construction Co., Ltd. (Real estate management & development) | 87,300 | 9,903 | |||||||
Fanuc Corporation (Machinery) | 162,200 | 26,744 | |||||||
Fuji Heavy Industries, Ltd. (Automobiles) | 1,510,700 | 53,458 | |||||||
Hoya Corporation (Electronic equipment, instruments & components) | 774,200 | 26,187 | |||||||
ITOCHU Corporation (Trading companies & distributors) | 1,483,500 | 15,836 | |||||||
Kao Corporation (Personal products) | 433,100 | 17,079 | |||||||
Keyence Corporation (Electronic equipment, instruments & components) | 68,100 | 30,345 | |||||||
M3, Inc. (Health care technology) | 387,500 | 6,484 | |||||||
Minebea Co., Ltd. (Machinery) | 863,444 | 12,751 | |||||||
Murata Manufacturing Co., Ltd. (Electronic equipment, instruments & components) | 422,100 | 46,060 | |||||||
Nidec Corporation (Electrical equipment) | 238,600 | 15,410 | |||||||
Nitori Holdings Co., Ltd. (Specialty retail) | 192,700 | 10,353 | |||||||
Nomura Research Institute, Ltd. (IT services) | 449,500 | 13,748 | |||||||
Omron Corporation (Electronic equipment, instruments & components) | 531,900 | 23,795 | |||||||
ORIX Corporation (Diversified financial services) | 3,338,200 | 42,004 | |||||||
* | Recruit Holdings Co., Ltd. (Professional services) | 168,200 | 4,831 | ||||||
Ryohin Keikaku Co., Ltd. (Multiline retail) | 84,200 | 10,377 | |||||||
SCSK Corporation (IT services) | 202,600 | 5,075 | |||||||
Secom Co., Ltd. (Commercial services & supplies) | 312,400 | 17,949 | |||||||
Seiko Epson Corporation (Technology | |||||||||
hardware, storage & peripherals) | 376,800 | 15,767 | |||||||
SMC Corporation (Machinery) | 71,400 | 18,723 | |||||||
Start Today Co., Ltd. (Internet & catalog retail) | 217,200 | 4,513 | |||||||
Sumitomo Mitsui Financial Group, Inc. (Banks) | 1,327,400 | 47,989 | |||||||
Sumitomo Realty & Development Co., Ltd. (Real estate management & development) | 737,000 | 25,109 | |||||||
Suruga Bank, Ltd. (Banks) | 870,000 | 15,988 | |||||||
Sysmex Corporation (Health care equipment & supplies) | 399,000 | 17,709 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Japan—(continued) | |||||||||
Tadano, Ltd. (Machinery) | 317,000 | $ | 3,916 | ||||||
Temp Holdings Co., Ltd. (Professional services) | 169,600 | 5,322 | |||||||
Tsuruha Holdings, Inc. (Food & staples retailing) | 141,100 | 8,164 | |||||||
668,705 | |||||||||
United Kingdom—14.4% | |||||||||
Ashtead Group plc (Trading companies & distributors) | 684,771 | 12,161 | |||||||
Babcock International Group plc (Commercial services & supplies) | 1,097,562 | 17,981 | |||||||
BG Group plc (Oil, gas & consumable fuels) | 702,782 | 9,404 | |||||||
BT Group plc (Diversified telecommunication services) | 5,909,473 | 36,757 | |||||||
* | BTG plc (Pharmaceuticals) | 823,758 | 10,167 | ||||||
Bunzl plc (Trading companies & distributors) | 627,094 | 17,143 | |||||||
Capita plc (Professional services) | 750,600 | 12,586 | |||||||
Compass Group plc (Hotels, restaurants & leisure) | 1,310,167 | 22,395 | |||||||
Derwent London plc (Real estate investment trusts (REITs)) | 120,315 | 5,617 | |||||||
easyJet plc (Airlines) | 1,137,220 | 29,430 | |||||||
* | Genel Energy plc (Oil, gas & consumable fuels) | 797,188 | 8,650 | ||||||
Halma plc (Electronic equipment, instruments & components) | 565,218 | 6,021 | |||||||
Hikma Pharmaceuticals plc (Pharmaceuticals) | 189,408 | 5,811 | |||||||
Hiscox, Ltd. (Insurance) | 542,562 | 6,083 | |||||||
InterContinental Hotels Group plc (Hotels, restaurants & leisure) | 414,961 | 16,696 | |||||||
ITV plc (Media) | 11,170,024 | 37,260 | |||||||
Next plc (Multiline retail) | 265,036 | 28,109 | |||||||
Provident Financial plc (Consumer finance) | 162,729 | 6,212 | |||||||
Prudential plc (Insurance) | 2,813,828 | 65,054 | |||||||
Reckitt Benckiser Group plc (Household products) | 445,876 | 36,113 | |||||||
Reed Elsevier plc (Media) | 1,156,050 | 19,748 | |||||||
Rio Tinto plc (Metals & mining) | 313,376 | 14,446 | |||||||
SSC plc (Electric utilities) | 1,101,627 | 27,835 | |||||||
Unilever plc (Food products) | 926,325 | 37,635 | |||||||
Whitbread plc (Hotels, restaurants & leisure) | 372,061 | 27,535 | |||||||
WPP plc (Media) | 552,222 | 11,482 | |||||||
528,331 | |||||||||
Emerging Asia—13.9% | |||||||||
China—5.2% | |||||||||
* | Alibaba Group Holding, Ltd.—ADR (Internet software & services) | 111,709 | 11,611 | ||||||
* | Baidu, Inc.—ADR (Internet software & services) | 87,842 | 20,025 | ||||||
Brilliance China Automotive Holdings, Ltd. (Automobiles) | 3,104,000 | 4,946 |
See accompanying Notes to Financial Statements.
66 | Annual Report | December 31, 2014 |
International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
China—(continued) | |||||||||
China Overseas Land & Investment, Ltd. (Real estate management & development) | 4,514,000 | $ | 13,382 | ||||||
CITIC Securities Co., Ltd. Class “H” (Capital markets) | 3,276,000 | 12,245 | |||||||
ENN Energy Holdings, Ltd. (Gas utilities) | 1,766,000 | 9,991 | |||||||
Lenovo Group, Ltd. (Technology hardware, storage & peripherals) | 13,964,000 | 18,339 | |||||||
NetEase, Inc.—ADR (Internet software & services) | 110,329 | 10,938 | |||||||
Ping An Insurance Group Co. of China, Ltd. Class “H” (Insurance) | 3,697,000 | 37,387 | |||||||
Sihuan Pharmaceutical Holdings Group, Ltd. (Pharmaceuticals) | 9,322,000 | 6,236 | |||||||
Tencent Holdings, Ltd. (Internet software & services) | 1,711,400 | 24,762 | |||||||
* | Vipshop Holdings, Ltd.—ADR (Internet & catalog retail) | 552,542 | 10,797 | ||||||
* | WuXi PharmaTech Cayman, Inc.—ADR (Life sciences tools & services) | 163,790 | 5,515 | ||||||
* | YY, Inc.—ADR (Internet software & services) | 87,280 | 5,441 | ||||||
191,615 | |||||||||
India—5.2% | |||||||||
Adani Ports & Special Economic Zone, Ltd. (Transportation infrastructure) | 1,268,859 | 6,406 | |||||||
Asian Paints, Ltd. (Chemicals) | 975,155 | 11,564 | |||||||
Axis Bank, Ltd. (Banks) | 2,107,153 | 16,658 | |||||||
HCL Technologies, Ltd. (IT services) | 553,634 | 14,044 | |||||||
HDFC Bank, Ltd. (Banks) | 1,390,337 | 20,866 | |||||||
Hero MotoCorp, Ltd. (Automobiles) | 215,118 | 10,533 | |||||||
Hindustan Unilever, Ltd. (Household products) | 507,313 | 6,072 | |||||||
Housing Development Finance Corporation (Thrifts & mortgage finance) | 936,058 | 16,742 | |||||||
Mahindra & Mahindra, Ltd. (Automobiles) | 298,400 | 5,812 | |||||||
Maruti Suzuki India, Ltd. (Automobiles) | 156,783 | 8,248 | |||||||
Sun Pharmaceutical Industries, Ltd. (Pharmaceuticals) | 1,874,188 | 24,506 | |||||||
Tata Consultancy Services, Ltd. (IT services) | 512,090 | 20,782 | |||||||
Tata Motors, Ltd. (Automobiles) | 2,247,632 | 17,573 | |||||||
Tech Mahindra, Ltd. (IT services) | 137,092 | 5,620 | |||||||
Ultratech Cement, Ltd. (Construction materials) | 126,142 | 5,325 | |||||||
190,751 | |||||||||
Indonesia—0.7% | |||||||||
PT Bank Rakyat Indonesia Persero Tbk (Banks) | 26,390,500 | 24,806 | |||||||
South Korea—1.1% | |||||||||
* | Coway Co., Ltd. (Household durables) | 80,434 | 6,133 | ||||||
Samsung Electronics Co., Ltd. (Technology hardware, storage & peripherals) | 16,158 | 19,426 | |||||||
* | SK Hynix, Inc. (Semiconductors & semiconductor equipment) | 369,060 | 15,772 | ||||||
41,331 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
Taiwan—1.2% | |||||||||
Fubon Financial Holding Co., Ltd. (Diversified financial services) | 9,912,000 | $ | 15,777 | ||||||
Largan Precision Co., Ltd. (Electronic equipment, instruments & components) | 95,000 | 7,112 | |||||||
Taiwan Semiconductor Manufacturing Co., Ltd.—ADR (Semiconductors & semiconductor equipment) | 940,667 | 21,052 | |||||||
43,941 | |||||||||
Thailand—0.5% | |||||||||
Advanced Info Service PCL (Wireless telecommunication services) | 1,272,000 | 9,646 | |||||||
Kasikornbank PCL (Banks) | 1,351,500 | 9,355 | |||||||
19,001 | |||||||||
Canada—6.1% | |||||||||
Alimentation Couche Tard, Inc. Class “B” (Food & staples retailing) | 474,087 | 19,869 | |||||||
Brookfield Asset Management, Inc. Class “A” (Real estate management & development)† | 425,371 | 21,324 | |||||||
Canadian National Railway Co. (Road & rail)† | 188,442 | 12,986 | |||||||
Canadian Natural Resources, Ltd. (Oil, gas & consumable fuels) | 779,382 | 24,097 | |||||||
Canadian Pacific Railway, Ltd. (Road & rail)† | 63,959 | 12,324 | |||||||
CI Financial Corporation (Capital markets) | 524,404 | 14,575 | |||||||
Constellation Software, Inc. (Software) | 16,419 | 4,882 | |||||||
Dollarama, Inc. (Multiline retail) | 138,360 | 7,074 | |||||||
Enbridge, Inc. (Oil, gas & consumable fuels) | 790,496 | 40,647 | |||||||
Peyto Exploration & Development Corporation (Oil, gas & consumable fuels) | 264,061 | 7,607 | |||||||
Saputo, Inc. (Food products) | 513,092 | 15,422 | |||||||
Suncor Energy, Inc. (Oil, gas & consumable fuels) | 978,000 | 31,062 | |||||||
The Toronto-Dominion Bank (Banks) | 272,484 | 13,019 | |||||||
224,888 | |||||||||
Asia—4.4% | |||||||||
Australia—2.5% | |||||||||
Australia & New Zealand Banking Group, Ltd. (Banks) | 1,153,615 | 30,017 | |||||||
CSL, Ltd. (Biotechnology) | 217,065 | 15,248 | |||||||
REA Group, Ltd. (Media) | 158,087 | 5,796 | |||||||
Telstra Corporation, Ltd. (Diversified telecommunication services) | 8,705,400 | 42,263 | |||||||
93,324 | |||||||||
Hong Kong—1.9% | |||||||||
AIA Group, Ltd. (Insurance) | 9,878,200 | 54,293 | |||||||
* | China High Precision Automation Group, Ltd. (Electronic equipment, instruments & components)**§ | 6,597,000 | 34 | ||||||
Hong Kong Exchanges and Clearing, Ltd. (Diversified financial services) | 402,800 | 8,893 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 67 |
International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Asia—(continued) | |||||||||
Hong Kong—(continued) | |||||||||
Techtronic Industries Co. (Household durables) | 2,195,000 | $ | 7,042 | ||||||
70,262 | |||||||||
Emerging Latin America—2.7% | |||||||||
Brazil—1.8% | |||||||||
AMBEV S.A.—ADR (Beverages) | 4,454,463 | 27,707 | |||||||
BB Seguridade Participacoes S.A. (Insurance) | 1,939,500 | 23,404 | |||||||
CETIP S.A. - Mercados Organizados (Capital markets) | 409,400 | 4,985 | |||||||
Kroton Educacional S.A. (Diversified consumer services) | 2,094,700 | 12,204 | |||||||
68,300 | |||||||||
Mexico—0.5% | |||||||||
* | Arca Continental S.A.B. de C.V. (Beverages) | 776,762 | 4,910 | ||||||
* | Cemex S.A.B. de C.V. (Construction materials) | 4,098,304 | 4,183 | ||||||
Fibra Uno Administracion S.A. de C.V. (Real estate investment trusts (REITs)) | 2,698,500 | 7,956 | |||||||
17,049 | |||||||||
Peru—0.4% | |||||||||
Credicorp, Ltd. (Banks)† | 95,736 | 15,335 | |||||||
Emerging Europe, Mid-East, Africa—1.8% | |||||||||
South Africa—1.3% | |||||||||
Bidvest Group, Ltd. (Industrial conglomerates) | 354,876 | 9,277 | |||||||
MTN Group, Ltd. (Wireless telecommunication services) | 827,471 | 15,741 | |||||||
Naspers, Ltd. (Media) | 69,849 | 9,035 | |||||||
Sanlam, Ltd. (Insurance) | 863,064 | 5,193 | |||||||
Tiger Brands, Ltd. (Food products) | 218,606 | 6,929 | |||||||
46,175 | |||||||||
United Arab Emirates—0.5% | |||||||||
Dragon Oil plc (Oil, gas & consumable fuels) | 1,013,699 | 8,492 | |||||||
Emaar Properties PJSC (Real estate management & development) | 3,302,106 | 6,364 | |||||||
First Gulf Bank PJSC (Banks) | 1,153,297 | 5,297 | |||||||
20,153 | |||||||||
Total Common Stocks—96.7% (cost $3,243,926) | 3,560,440 | ||||||||
Preferred Stock | |||||||||
Brazil—0.3% | |||||||||
Itau Unibanco Holding S.A. (Banks) | 959,820 | 12,577 | |||||||
Total Preferred Stock—0.3% (cost $12,829) | 12,577 |
Issuer | Shares/ Principal Amount/ Contracts | Value | |||||||
Rights | |||||||||
Spain—0.0% | |||||||||
* | Banco Bilbao Vizcaya Argentaria S.A., Expiring 1/7/15, $0.00 (Banks) | 1,682,799 | $ | 161 | |||||
* | Repsol S.A., Expiring 1/8/15, $0.00 (Oil, gas & consumable fuels) | 1,502,755 | 831 | ||||||
Total Rights—0.0% (cost $1,032) | 992 | ||||||||
Affiliated Fund | |||||||||
China—0.9% | |||||||||
William Blair China A-Share Fund, LLC | 2,202,200 | 33,099 | |||||||
Total Affiliated Fund—0.9% (cost $22,022) | 33,099 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $69,228, collateralized by Federal Farm Credit Bank, 2.700%, due 12/2/24, and Federal National Mortgage Association, 2.625%, due 9/6/24, and U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 69,228 | 69,228 | ||||||
Total Repurchase Agreement—1.9% (cost $69,228) | 69,228 | ||||||||
Total Investments—99.8% (cost $3,349,037) | 3,676,336 | ||||||||
Cash and other assets, less liabilities—0.2% | 7,151 | ||||||||
Net assets—100.0% | $ | 3,683,487 |
* Non-income producing securities
† = U.S. listed foreign security
ADR = American Depository Receipt
** = Fair valued pursuant to Valuation Procedures adopted by the Board of Trustees. This holding represents 0.00% of the Fund’s net assets at December 31, 2014.
§ = Deemed illiquid pursuant to Liquidity Procedures approved by the Board of Trustees. This holding represents 0.00% of the Fund’s net assets at December 31, 2014.
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
See accompanying Notes to Financial Statements.
68 | Annual Report | December 31, 2014 |
International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 26.4 | % | ||
Consumer Discretionary | 13.7 | % | ||
Information Technology | 13.6 | % | ||
Health Care | 13.6 | % | ||
Industrials | 11.2 | % | ||
Consumer Staples | 6.3 | % | ||
Energy | 5.1 | % | ||
Materials | 5.0 | % | ||
Telecommunication Services | 4.0 | % | ||
Utilities | 1.1 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
Euro | 18.9 | % | ||
Japanese Yen | 18.5 | % | ||
British Pound Sterling | 17.6 | % | ||
U.S. Dollar | 8.1 | % | ||
Swiss Franc | 6.4 | % | ||
Hong Kong Dollar | 5.6 | % | ||
Indian Rupee | 5.3 | % | ||
Canadian Dollar | 4.9 | % | ||
Swedish Krona | 2.9 | % | ||
Australian Dollar | 2.6 | % | ||
Brazilian Real | 1.5 | % | ||
Danish Krone | 1.3 | % | ||
South African Rand | 1.3 | % | ||
Norwegian Krone | 1.3 | % | ||
South Korean Won | 1.2 | % | ||
All Other Currencies | 2.6 | % | ||
Total | 100.0 | % |
As of December 31, 2014, the Fund invested in William Blair China A-Share Fund, LLC, an affiliated fund. There are no unfunded commitments to the affiliated fund and the Fund may redeem its investment weekly.
Share Activity | Year Ended December 31, 2014 | |||||||||||||||
Fund Name | Balance 12/31/2013 | Purchases | Sales | Balance 12/31/2014 | Value | Dividend Income | Net realized gain (loss) | Change in net unrealized appreciation (depreciation) | ||||||||
William Blair China A-Share Fund, LLC | 2,202,200 | — | — | 2,202,200 | $ 33,099 | $— | $— | $7,201 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 69 |
70 | Annual Report | December 31, 2014 |
Institutional International Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Institutional Class | (2.66 | )% | 12.83 | % | 8.29 | % | 6.25 | % | ||||||||
MSCIACW Ex-U.S. IMI (net) | (3.89 | ) | 9.22 | 4.71 | 5.37 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Shares of the Fund are available without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) All Country World (ACW) Ex-U.S. Investable Market Index (IMI) (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets, excluding the United States. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 71 |
Institutional International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Europe, Mid-East—35.2% | |||||||||
Belgium—0.5% | |||||||||
* | Telenet Group Holding N.V. (Media) | 124,185 | $ | 6,969 | |||||
UCB S.A. (Pharmaceuticals) | 70,109 | 5,331 | |||||||
12,300 | |||||||||
Denmark—1.3% | |||||||||
Coloplast A/S Class “B” (Health care equipment & supplies) | 105,571 | 8,834 | |||||||
Novo Nordisk A/S Class “B” (Pharmaceuticals) | 506,404 | 21,421 | |||||||
30,255 | |||||||||
Finland—2.1% | |||||||||
Kone Oyj Class “B” (Machinery) | 279,631 | 12,731 | |||||||
Sampo Oyj Class “A” (Insurance) | 775,515 | 36,305 | |||||||
49,036 | |||||||||
France—5.3% | |||||||||
AXA S.A. (Insurance) | 1,204,814 | 27,762 | |||||||
BNP Paribas S.A. (Banks) | 398,959 | 23,552 | |||||||
Bollore S.A. (Air freight & logistics) | 583,782 | 2,659 | |||||||
Cap Gemini S.A. (IT services) | 81,494 | 5,828 | |||||||
Essilor International S.A. (Health care equipment & supplies) | 131,593 | 14,675 | |||||||
Hermes International (Textiles, apparel & luxury goods) | 13,724 | 4,887 | |||||||
Ingenico (Electronic equipment, instruments & components) | 36,369 | 3,831 | |||||||
Plastic Omnium S.A. (Auto components) | 123,396 | 3,349 | |||||||
Total S.A. (Oil, gas & consumable fuels) | 291,147 | 14,916 | |||||||
Unibail-Rodamco SE (Real estate investment trusts (REITs)) | 44,398 | 11,390 | |||||||
Valeo S.A. (Auto components) | 97,867 | 12,178 | |||||||
125,027 | |||||||||
Germany—5.6% | |||||||||
BASF SE (Chemicals) | 211,079 | 17,705 | |||||||
Bayer AG (Pharmaceuticals) | 237,563 | 32,382 | |||||||
Bayerische Motoren Werke AG (Automobiles) | 147,466 | 15,914 | |||||||
Brenntag AG (Trading companies & distributors) | 134,925 | 7,544 | |||||||
Continental AG (Auto components) | 105,199 | 22,189 | |||||||
Deutsche Annington Immobilien SE (Real estate management & development) | 129,402 | 4,393 | |||||||
Deutsche Wohnen AG (Real estate management & development) | 164,017 | 3,869 | |||||||
Fielmann AG (Specialty retail) | 54,090 | 3,694 | |||||||
* | Morphosys AG (Life sciences tools & services) | 41,840 | 3,898 | ||||||
ProSiebenSat.1 Media AG (Media) | 276,726 | 11,563 | |||||||
Wirecard AG (IT services) | 196,200 | 8,555 | |||||||
131,706 | |||||||||
Ireland—1.5% | |||||||||
* | ICON plc (Life sciences tools & services)† | 64,242 | 3,276 | ||||||
Shire plc (Pharmaceuticals) | 360,089 | 25,530 | |||||||
Smurfit Kappa Group plc (Containers & packaging) | 263,651 | 5,929 | |||||||
34,735 |
Issuer | Shares | Value | |||||||
Common Stocks-(continued) | |||||||||
Europe, Mid-East—(continued) | |||||||||
Israel—1.7% | |||||||||
* | Check Point Software Technologies, Ltd. (Software)† | 260,311 | $ | 20,453 | |||||
Teva Pharmaceutical Industries, Ltd.—ADR (Pharmaceuticals) | 341,498 | 19,639 | |||||||
40,092 | |||||||||
Italy—1.5% | |||||||||
Banca Generali SpA (Capital markets) | 229,392 | 6,380 | |||||||
Intesa Sanpaolo SpA (Banks) | 9,584,167 | 27,803 | |||||||
34,183 | |||||||||
Luxembourg—0.2% | |||||||||
Eurofins Scientific SE (Life sciences tools & services) | 19,309 | 4,929 | |||||||
Netherlands—0.6% | |||||||||
* | NXP Semiconductor N.V. (Semiconductors & semiconductor equipment)† | 186,580 | 14,255 | ||||||
Norway—1.3% | |||||||||
Gjensidige Forsikring ASA (Insurance) | 203,406 | 3,319 | |||||||
Telenor ASA (Diversified telecommunication services) | 1,279,424 | 25,881 | |||||||
29,200 | |||||||||
Spain—3.0% | |||||||||
Abertis Infraestructuras S.A. (Transportation infrastructure) | 409,956 | 8,129 | |||||||
Amadeus IT Holding S.A. Class “A” (IT services) | 463,885 | 18,475 | |||||||
Banco Bilbao Vizcaya Argentaria S.A. (Banks) | 1,070,531 | 10,111 | |||||||
Bankinter S.A. (Banks) | 1,409,240 | 11,321 | |||||||
Mapfre S.A. (Insurance) | 1,019,404 | 3,446 | |||||||
Repsol S.A. (Oil, gas & consumable fuels) | 963,057 | 18,029 | |||||||
69,511 | |||||||||
Sweden—2.8% | |||||||||
Assa Abloy AB Class “B” (Building products) | 90,849 | 4,799 | |||||||
Atlas Copco AB Class “A” (Machinery) | 654,040 | 18,199 | |||||||
Hennes & Mauritz AB Class “B” (Specialty retail) | 193,700 | 8,047 | |||||||
Hexagon AB (Electronic equipment, instruments & components) | 178,278 | 5,500 | |||||||
Hexpol AB (Chemicals) | 37,766 | 3,554 | |||||||
Intrum Justitia AB (Commercial services & supplies) | 117,441 | 3,478 | |||||||
Swedbank AB Class “A” (Banks) | 885,354 | 21,967 | |||||||
65,544 | |||||||||
Switzerland—7.8% | |||||||||
* | Actelion, Ltd. (Biotechnology) | 125,098 | 14,401 | ||||||
* | Adecco S.A. (Professional services) | 114,659 | 7,882 | ||||||
* | Clariant AG (Chemicals) | 581,011 | 9,736 | ||||||
Geberit AG (Building products) | 29,973 | 10,140 | |||||||
* | Glencore plc (Metals & mining) | 7,792,742 | 35,970 | ||||||
Nestle S.A. (Food products) | 297,999 | 21,725 |
See accompanying Notes to Financial Statements.
72 | Annual Report | December 31, 2014 |
Institutional International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Europe, Mid-East—(continued) | |||||||||
Switzerland—(continued) | |||||||||
Novartis AG (Pharmaceuticals) | 308,975 | $ | 28,655 | ||||||
Partners Group Holding AG (Capital markets) | 54,394 | 15,825 | |||||||
Roche Holding AG (Pharmaceuticals) | 94,991 | 25,737 | |||||||
Sonova Holding AG (Health care equipment & supplies) | 61,118 | 8,979 | |||||||
Straumann Holding AG (Health care equipment & supplies) | 17,951 | 4,510 | |||||||
183,560 | |||||||||
Japan—18.2% | |||||||||
Asahi Group Holdings, Ltd. (Beverages) | 232,000 | 7,177 | |||||||
Asahi Kasei Corporation (Chemicals) | 2,215,000 | 20,206 | |||||||
Astellas Pharma, Inc. (Pharmaceuticals) | 2,000,600 | 27,853 | |||||||
Daikin Industries, Ltd. (Building products) | 300,100 | 19,244 | |||||||
Daito Trust Construction Co., Ltd. (Real estate management & development) | 55,600 | 6,307 | |||||||
Fanuc Corporation (Machinery) | 103,000 | 16,983 | |||||||
Fuji Heavy Industries, Ltd. (Automobiles) | 961,300 | 34,016 | |||||||
Hoya Corporation (Electronic equipment, instruments & components) | 491,800 | 16,635 | |||||||
ITOCHU Corporation (Trading companies & distributors) | 942,400 | 10,060 | |||||||
Kao Corporation (Personal products) | 275,500 | 10,864 | |||||||
Keyence Corporation (Electronic equipment, instruments & components) | 43,300 | 19,294 | |||||||
M3, Inc. (Health care technology) | 246,100 | 4,118 | |||||||
Minebea Co., Ltd. (Machinery) | 548,726 | 8,104 | |||||||
Murata Manufacturing Co., Ltd. (Electronic equipment, instruments & components) | 270,500 | 29,517 | |||||||
Nidec Corporation (Electrical equipment) | 151,500 | 9,785 | |||||||
Nitori Holdings Co., Ltd. (Specialty retail) | 122,400 | 6,576 | |||||||
Nomura Research Institute, Ltd. (IT services) | 286,000 | 8,747 | |||||||
Omron Corporation (Electronic equipment, instruments & components) | 338,400 | 15,139 | |||||||
ORIX Corporation (Diversified financial services) | 2,124,400 | 26,731 | |||||||
* | Recruit Holdings Co., Ltd. (Professional services) | 107,000 | 3,073 | ||||||
Ryohin Keikaku Co., Ltd. (Multiline retail) | 53,500 | 6,594 | |||||||
SCSK Corporation (IT services) | 128,700 | 3,224 | |||||||
Secom Co., Ltd. (Commercial services & supplies) | 198,400 | 11,399 | |||||||
Seiko Epson Corporation (Technology hardware, storage & peripherals) | 240,600 | 10,068 | |||||||
SMC Corporation (Machinery) | 45,300 | 11,879 | |||||||
Start Today Co., Ltd. (Internet & catalog retail) | 139,100 | 2,890 | |||||||
Sumitomo Mitsui Financial Group, Inc. (Banks) | 844,900 | 30,545 | |||||||
Sumitomo Realty & Development Co., Ltd. (Real estate management & development) . | 469,000 | 15,978 | |||||||
Suruga Bank, Ltd. (Banks) | 553,000 | 10,162 | |||||||
Sysmex Corporation (Health care equipment & supplies) | 253,500 | 11,251 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Japan—(continued) | |||||||||
Tadano, Ltd. (Machinery) | 199,000 | $ | 2,458 | ||||||
Temp Holdings Co., Ltd. (Professional services) | 107,700 | 3,380 | |||||||
Tsuruha Holdings, Inc. (Food & staples retailing) | 89,700 | 5,190 | |||||||
425,447 | |||||||||
United Kingdom—14.4% | |||||||||
Ashtead Group plc (Trading companies & distributors) | 432,518 | 7,681 | |||||||
Babcock International Group plc (Commercial services & supplies) | 697,194 | 11,422 | |||||||
BG Group plc (Oil, gas & consumable fuels) | 446,422 | 5,974 | |||||||
BT Group plc (Diversified telecommunication services) | 3,772,150 | 23,463 | |||||||
* | BTG plc (Pharmaceuticals) | 523,268 | 6,459 | ||||||
Bunzl plc (Trading companies & distributors) | 398,343 | 10,889 | |||||||
Capita plc (Professional services) | 477,503 | 8,007 | |||||||
Compass Group plc (Hotels, restaurants & leisure) | 832,245 | 14,225 | |||||||
Derwent London plc (Real estate investment trusts (REITs)) | 76,426 | 3,568 | |||||||
easyJet plc (Airlines) | 722,385 | 18,695 | |||||||
* | Genel Energy plc (Oil, gas & consumable fuels) | 510,887 | 5,544 | ||||||
Halma plc (Electronic equipment, instruments & components) | 359,038 | 3,824 | |||||||
Hikma Pharmaceuticals plc (Pharmaceuticals) | 120,316 | 3,691 | |||||||
Hiscox, Ltd. (Insurance) | 344,646 | 3,864 | |||||||
InterContinental Hotels Group plc (Hotels, restaurants & leisure) | 264,880 | 10,658 | |||||||
ITV plc (Media) | 7,095,428 | 23,668 | |||||||
Next plc (Multiline retail) | 169,218 | 17,947 | |||||||
Provident Financial plc (Consumer finance) | 103,369 | 3,946 | |||||||
Prudential plc (Insurance) | 1,787,401 | 41,324 | |||||||
Reckitt Benckiser Group plc (Household products) | 283,421 | 22,955 | |||||||
Reed Elsevier plc (Media) | 734,847 | 12,553 | |||||||
Rio Tinto plc (Metals & mining) | 199,063 | 9,176 | |||||||
SSC plc (Electric utilities) | 700,811 | 17,707 | |||||||
Unilever plc (Food products) | 588,820 | 23,923 | |||||||
Whitbread plc (Hotels, restaurants & leisure) | 236,341 | 17,491 | |||||||
WPP plc (Media) | 352,495 | 7,329 | |||||||
335,983 | |||||||||
Emerging Asia—13.9% | |||||||||
China—5.2% | |||||||||
* | Alibaba Group Holding, Ltd.—ADR (Internet software & services) | 70,961 | 7,376 | ||||||
* | Baidu, Inc.—ADR (Internet software & services) | 55,799 | 12,721 | ||||||
Brilliance China Automotive Holdings, Ltd. (Automobiles) | 1,972,000 | 3,142 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 73 |
Institutional International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
China—(continued) | |||||||||
China Overseas Land & Investment, Ltd. (Real estate management & development) . | 2,884,000 | $ | 8,550 | ||||||
CITIC Securities Co., Ltd. Class “H” (Capital markets) | 2,099,500 | 7,847 | |||||||
ENN Energy Holdings, Ltd. (Gas utilities) | 1,122,000 | 6,348 | |||||||
Lenovo Group, Ltd. (Technology hardware, storage & peripherals) | 8,870,000 | 11,649 | |||||||
NetEase, Inc.—ADR (Internet software & services) | 70,426 | 6,982 | |||||||
Ping An Insurance Group Co. of China, Ltd. Class “H” (Insurance) | 2,360,500 | 23,871 | |||||||
Sihuan Pharmaceutical Holdings Group, Ltd. (Pharmaceuticals) | 5,922,000 | 3,962 | |||||||
Tencent Holdings, Ltd. (Internet software & services) | 1,087,100 | 15,729 | |||||||
* | Vipshop Holdings, Ltd.—ADR (Internet & catalog retail) | 352,005 | 6,878 | ||||||
* | WuXi PharmaTech Cayman, Inc.—ADR (Life sciences tools & services) | 104,307 | 3,512 | ||||||
* | YY, Inc.—ADR (Internet software & services) | 55,442 | 3,456 | ||||||
122,023 | |||||||||
India—5.2% | |||||||||
Adani Ports & Special Economic Zone, Ltd. (Transportation infrastructure) | 806,005 | 4,069 | |||||||
Asian Paints, Ltd. (Chemicals) | 619,438 | 7,345 | |||||||
Axis Bank, Ltd. (Banks) | 1,340,489 | 10,597 | |||||||
HCL Technologies, Ltd. (IT services) | 351,680 | 8,921 | |||||||
HDFC Bank, Ltd. (Banks) | 883,170 | 13,254 | |||||||
Hero MotoCorp, Ltd. (Automobiles) | 136,647 | 6,691 | |||||||
Hindustan Unilever, Ltd. (Household products) | 322,941 | 3,866 | |||||||
Housing Development Finance Corporation (Thrifts & mortgage finance) | 594,603 | 10,635 | |||||||
Mahindra & Mahindra, Ltd. (Automobiles) | 189,550 | 3,692 | |||||||
Maruti Suzuki India, Ltd. (Automobiles) | 99,592 | 5,239 | |||||||
Sun Pharmaceutical Industries, Ltd. (Pharmaceuticals) | 1,190,522 | 15,567 | |||||||
Tata Consultancy Services, Ltd. (IT services) | 325,290 | 13,201 | |||||||
Tata Motors, Ltd. (Automobiles) | 1,427,742 | 11,163 | |||||||
Tech Mahindra, Ltd. (IT services) | 87,213 | 3,575 | |||||||
Ultratech Cement, Ltd. (Construction materials) | 80,128 | 3,383 | |||||||
121,198 | |||||||||
Indonesia—0.7% | |||||||||
PT Bank Rakyat Indonesia Persero Tbk (Banks) | 16,763,700 | 15,758 | |||||||
South Korea—1.1% | |||||||||
* | Coway Co., Ltd. (Household durables) | 51,093 | 3,896 | ||||||
Samsung Electronics Co., Ltd. (Technology hardware, storage & peripherals) | 10,331 | 12,420 | |||||||
* | SK Hynix, Inc. (Semiconductors & semiconductor equipment) | 234,770 | 10,033 | ||||||
26,349 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
Taiwan—1.2% | |||||||||
Fubon Financial Holding Co., Ltd. (Diversified financial services) | 6,297,000 | $ | 10,023 | ||||||
Largan Precision Co., Ltd. (Electronic equipment, instruments & components) | 60,000 | 4,491 | |||||||
Taiwan Semiconductor Manufacturing Co., Ltd.—ADR (Semiconductors & semiconductor equipment) | 597,531 | 13,373 | |||||||
27,887 | |||||||||
Thailand—0.5% | |||||||||
Advanced Info Service PCL (Wireless telecommunication services) | 807,400 | 6,122 | |||||||
Kasikornbank PCL (Banks) | 858,500 | 5,943 | |||||||
12,065 | |||||||||
Canada—6.1% | |||||||||
Alimentation Couche Tard, Inc. Class “B” (Food & staples retailing) | 301,150 | 12,621 | |||||||
Brookfield Asset Management, Inc. Class “A” (Real estate management & development)† | 270,204 | 13,545 | |||||||
Canadian National Railway Co. (Road & rail)† | 119,957 | 8,266 | |||||||
Canadian Natural Resources, Ltd. (Oil, gas & consumable fuels) | 495,080 | 15,307 | |||||||
Canadian Pacific Railway, Ltd. (Road & rail)† | 40,715 | 7,845 | |||||||
CI Financial Corporation (Capital markets) | 333,112 | 9,258 | |||||||
Constellation Software, Inc. (Software) | 10,412 | 3,096 | |||||||
Dollarama, Inc. (Multiline retail) | 87,890 | 4,494 | |||||||
Enbridge, Inc. (Oil, gas & consumable fuels) . | 502,139 | 25,820 | |||||||
Peyto Exploration & Development Corporation (Oil, gas & consumable fuels) | 167,737 | 4,832 | |||||||
Saputo, Inc. (Food products) | 325,927 | 9,796 | |||||||
Suncor Energy, Inc. (Oil, gas & consumable fuels) | 622,600 | 19,775 | |||||||
The Toronto-Dominion Bank (Banks) | 174,571 | 8,341 | |||||||
142,996 | |||||||||
Asia—4.5% | |||||||||
Australia—2.6% | |||||||||
Australia & New Zealand Banking Group, Ltd. (Banks) | 732,800 | 19,067 | |||||||
CSL, Ltd. (Biotechnology) | 138,558 | 9,733 | |||||||
REA Group, Ltd. (Media) | 100,420 | 3,682 | |||||||
Telstra Corporation, Ltd. (Diversified telecommunication services) | 5,526,202 | 26,829 | |||||||
59,311 | |||||||||
Hong Kong—1.9% | |||||||||
AIA Group, Ltd. (Insurance) | 6,307,600 | 34,669 | |||||||
* | China High Precision Automation Group, Ltd. (Electronic equipment, instruments & components)**§ | 3,373,000 | 17 | ||||||
Hong Kong Exchanges and Clearing, Ltd. (Diversified financial services) | 255,800 | 5,647 | |||||||
Techtronic Industries Co. (Household durables) | 1,381,500 | 4,432 | |||||||
44,765 |
See accompanying Notes to Financial Statements.
74 | Annual Report | December 31, 2014 |
Institutional International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Latin America—2.7% | |||||||||
Brazil—1.8% | |||||||||
AMBEV S.A.—ADR (Beverages) | 2,829,566 | $ | 17,600 | ||||||
BB Seguridade Participacoes S.A. (Insurance) | 1,232,000 | 14,867 | |||||||
CETIP S.A. - Mercados Organizados (Capital markets) | 260,000 | 3,166 | |||||||
Kroton Educacional S.A. (Diversified consumer services) | 1,330,600 | 7,752 | |||||||
43,385 | |||||||||
Mexico—0.5% | |||||||||
* | Arca Continental S.A.B. de C.V. (Beverages) | 493,415 | 3,119 | ||||||
* | Cemex S.A.B. de C.V. (Construction materials) | 2,603,400 | 2,657 | ||||||
Fibra Uno Administracion S.A. de C.V. (Real estate investment trusts (REITs)) | 1,714,100 | 5,054 | |||||||
10,830 | |||||||||
Peru—0.4% | |||||||||
Credicorp, Ltd. (Banks)† | 60,813 | 9,741 | |||||||
Emerging Europe, Mid-East, Africa—1.8% | |||||||||
South Africa—1.3% | |||||||||
Bidvest Group, Ltd. (Industrial conglomerates) | 225,426 | 5,893 | |||||||
MTN Group, Ltd. (Wireless telecommunication services) | 525,627 | 9,999 | |||||||
Naspers, Ltd. (Media) | 44,763 | 5,790 | |||||||
Sanlam, Ltd. (Insurance) | 550,221 | 3,311 | |||||||
Tiger Brands, Ltd. (Food products) | 139,045 | 4,407 | |||||||
29,400 | |||||||||
United Arab Emirates—0.5% | |||||||||
Dragon Oil plc (Oil, gas & consumable fuels) | 643,922 | 5,394 | |||||||
Emaar Properties PJSC (Real estate | |||||||||
management & development) | 2,097,566 | 4,043 | |||||||
First Gulf Bank PJSC (Banks) | 732,598 | 3,365 | |||||||
12,802 | |||||||||
Total Common Stocks—96.8% (cost $2,084,688) | 2,264,273 | ||||||||
Preferred Stock | |||||||||
Brazil—0.3% | |||||||||
Itau Unibanco Holding S.A. (Banks) | 602,200 | 7,891 | |||||||
Total Preferred Stock—0.3% (cost $8,043) | 7,891 |
Issuer | Shares/ Principal Amount/ Contracts | Value | |||||||
Rights | |||||||||
Spain—0.0% | |||||||||
* | Banco Bilbao Vizcaya Argentaria S.A., Expiring 1/7/15, $0.00 (Banks) | 1,070,531 | $ | 102 | |||||
* | Repsol S.A., Expiring 1/8/15, $0.00 (Oil, gas & consumable fuels) | 963,057 | 533 | ||||||
Total Rights—0.0% (cost $660) | 635 | ||||||||
Affiliated Fund | |||||||||
China—0.8% | |||||||||
William Blair China A-Share Fund, LLC | 1,183,400 | 17,787 | |||||||
Total Affiliated Fund—0.8% (cost $11,834) | 17,787 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $33,878, collateralized by Federal National Mortgage Association, 2.625%, due 9/6/24 | $ | 33,878 | 33,878 | ||||||
Total Repurchase Agreement—1.5% | |||||||||
(cost $33,878) | 33,878 | ||||||||
Total Investments—99.4% | |||||||||
(cost $2,139,103) | 2,324,464 | ||||||||
Cash and other assets, less liabilities—0.6% | 14,705 | ||||||||
Net assets—100.0% | $ | 2,339,169 |
* Non-income producing securities
† = U.S. listed foreign security
ADR = American Depository Receipt
** = Fair valued pursuant to Valuation Procedures adopted by the Board of Trustees. This holding represents 0.00% of the Fund’s net assets at December 31, 2014.
§ = Deemed illiquid pursuant to Liquidity Procedures approved by the Board of Trustees. This holding represents 0.00% of the Fund’s net assets at December 31, 2014.
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 75 |
Institutional International Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 26.5 | % | ||
Information Technology | 13.6 | % | ||
Health Care | 13.6 | % | ||
Consumer Discretionary | 13.6 | % | ||
Industrials | 11.2 | % | ||
Consumer Staples | 6.3 | % | ||
Energy | 5.1 | % | ||
Materials | 5.0 | % | ||
Telecommunication Services | 4.0 | % | ||
Utilities | 1.1 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
Euro | 18.9 | % | ||
Japanese Yen | 18.6 | % | ||
British Pound Sterling | 17.6 | % | ||
U.S. Dollar | 8.0 | % | ||
Swiss Franc | 6.4 | % | ||
Hong Kong Dollar | 5.6 | % | ||
Indian Rupee | 5.3 | % | ||
Canadian Dollar | 4.9 | % | ||
Swedish Krona | 2.9 | % | ||
Australian Dollar | 2.6 | % | ||
Brazilian Real | 1.5 | % | ||
Danish Krone | 1.3 | % | ||
South African Rand | 1.3 | % | ||
Norwegian Krone | 1.3 | % | ||
South Korean Won | 1.2 | % | ||
All Other Currencies | 2.6 | % | ||
Total | 100.0 | % |
As of December 31, 2014, the Fund invested in William Blair China A-Share Fund, LLC, an affiliated fund. There are no unfunded commitments to the affiliated fund and the Fund may redeem its investment weekly.
Share Activity | Year Ended December 31, 2014 | |||||||||||||||||||||||||||
Fund Name | Balance 12/31/2013 | Purchases | Sales | Balance 12/31/2014 | Value | Dividend Income | Net realized gain (loss) | Change in net unrealized appreciation (depreciation) | ||||||||||||||||||||
William Blair China A-Share Fund, LLC | 1,183,400 | — | — | 1,183,400 | $17,787 | $— | $— | $3,870 |
See accompanying Notes to Financial Statements.
76 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 77 |
International Small Cap Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | Since Inception (a) | |||||||||||||
Class N | (8.43 | )% | 11.62 | % | 8.99 | % | 6.41 | % | ||||||||
Class I | (8.10 | ) | 11.96 | 9.33 | 6.75 | |||||||||||
Institutional Class | (7.91 | ) | 12.23 | 9.57 | 6.95 | |||||||||||
MSCI ACW Ex-U.S. Small Cap Index (net) | (4.03 | ) | 10.84 | 6.80 | 6.25 |
(a) | For the period from November 1, 2005 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Smaller capitalization stocks are also more sensitive to purchase/sale transactions and changes in the issuer’s financial condition. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company L.L.C. without a sales load or distribution (12b-1) fees. Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) All Country World (ACW) Ex-U.S. Small Cap Index (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of small capitalization developed and emerging markets, excluding the United States. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
78 | Annual Report | December 31, 2014 |
International Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Europe, Mid-East—30.5% | |||||||||
Austria—1.0% | |||||||||
ams AG (Semiconductors & semiconductor equipment) | 168,599 | $ | 6,095 | ||||||
Denmark—3.2% | |||||||||
GN Store Nord A/S (Health care equipment & supplies) | 130,561 | 2,853 | |||||||
* | Royal UNIBREW (Beverages) | 24,468 | 4,289 | ||||||
* | Topdanmark A/S (Insurance) | 391,337 | 12,701 | ||||||
19,843 | |||||||||
Finland—1.1% | |||||||||
Huhtamaki OYJ (Containers & packaging) | 256,521 | 6,749 | |||||||
France—2.4% | |||||||||
Ingenico (Electronic equipment, instruments & components) | 63,103 | 6,647 | |||||||
Teleperformance (Professional services) | 118,642 | 8,076 | |||||||
14,723 | |||||||||
Germany—5.4% | |||||||||
Aareal Bank AG (Thrifts & mortgage finance) | 177,339 | 7,084 | |||||||
Aurelius AG (Capital markets) | 176,970 | 6,698 | |||||||
Bertrandt AG (Professional services) | 24,744 | 3,415 | |||||||
CTS Eventim AG & Co KGaA (Media) | 180,854 | 5,328 | |||||||
DMG MORI SEIKI AG (Machinery) | 105,934 | 2,979 | |||||||
KUKA AG (Machinery) | 44,496 | 3,147 | |||||||
Norma Group SE (Machinery) | 101,383 | 4,839 | |||||||
33,490 | |||||||||
Ireland—2.9% | |||||||||
Beazley plc (Insurance) | 950,903 | 4,233 | |||||||
Greencore Group plc (Food products) | 1,497,511 | 6,652 | |||||||
* | ICON plc (Life sciences tools & services)† | 146,165 | 7,453 | ||||||
18,338 | |||||||||
Israel—0.9% | |||||||||
Frutarom Industries, Ltd. (Chemicals) | 182,272 | 5,625 | |||||||
Italy—4.0% | |||||||||
* | Anima Holding SpA (Capital markets) | 629,662 | 3,168 | ||||||
Banca IFIS SpA (Diversified financial services) | 75,615 | 1,244 | |||||||
Brembo SpA (Auto components) | 202,674 | 6,793 | |||||||
De’Longhi SpA (Household durables) | 154,467 | 2,789 | |||||||
Industria Macchine Automatiche SpA (Machinery) | 96,483 | 4,217 | |||||||
Recordati SpA (Pharmaceuticals) | 411,458 | 6,379 | |||||||
24,590 | |||||||||
Norway—1.6% | |||||||||
Borregaard ASA (Chemicals) | 714,769 | 5,287 | |||||||
Opera Software ASA (Internet software & services) | 385,270 | 4,871 | |||||||
10,158 | |||||||||
Spain—2.6% | |||||||||
Atresmedia Corporation de Medios de Comunicaion S.A. (Media) | 415,830 | 5,842 | |||||||
Bankinter S.A. (Banks) | 941,082 | 7,560 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Europe, Mid-East—(continued) | |||||||||
Spain—(continued) | |||||||||
Viscofan S.A. (Food products) | 55,123 | $ | 2,925 | ||||||
16,327 | |||||||||
Sweden—3.0% | |||||||||
Fabege AB (Real estate management & development) | 178,407 | 2,290 | |||||||
Hexpol AB (Chemicals) | 40,164 | 3,780 | |||||||
Intrum Justitia AB (Commercial services & supplies) | 251,679 | 7,454 | |||||||
NIBE Industrier AB Class “B” (Building products) | 120,780 | 3,084 | |||||||
Nolato AB Class “B” (Industrial conglomerates) | 96,737 | 2,197 | |||||||
18,805 | |||||||||
Switzerland—2.4% | |||||||||
* | Leonteq AG (Capital markets) | 16,821 | 4,036 | ||||||
Straumann Holding AG (Health care equipment & supplies) | 24,060 | 6,045 | |||||||
* | Temenos Group AG (Software) | 137,040 | 4,880 | ||||||
14,961 | |||||||||
Japan—23.6% | |||||||||
ABC-Mart, Inc. (Specialty retail) | 130,200 | 6,300 | |||||||
Calbee, Inc. (Food products) | 89,600 | 3,086 | |||||||
Century Tokyo Leasing Corporation (Diversified financial services) | 230,300 | 5,738 | |||||||
Cosmos Pharmaceutical Corporation (Food & staples retailing) | 22,200 | 3,033 | |||||||
Fuji Seal International, Inc. (Containers & packaging) | 101,000 | 2,944 | |||||||
GLP J-Reit (Real estate investment trusts (REITs)) | 2,669 | 2,973 | |||||||
Haseko Corporation (Household durables) | 585,000 | 4,705 | |||||||
IT Holdings Corporation (IT services) | 245,100 | 3,702 | |||||||
Kanamoto Co., Ltd. (Trading companies & distributors) | 142,900 | 3,864 | |||||||
Kose Corporation (Personal products) | 79,200 | 3,096 | |||||||
M3, Inc. (Health care technology) | 475,900 | 7,963 | |||||||
Meitec Corporation (Professional services) | 155,600 | 4,600 | |||||||
MISUMI Group, Inc. (Trading companies & distributors) | 196,400 | 6,476 | |||||||
Nachi-Fujikoshi Corporation (Machinery) | 1,008,000 | 6,188 | |||||||
Nihon Kohden Corporation (Health care equipment & supplies) | 118,600 | 5,844 | |||||||
Nihon M&A Center, Inc. (Professional services) | 300,700 | 9,059 | |||||||
Nippon Prologis REIT, Inc. (Real estate investment trusts (REITs)) | 2,830 | 6,145 | |||||||
Nissan Chemical Industries, Ltd. (Chemicals) | 323,300 | 5,864 | |||||||
Obic Co., Ltd. (IT services) | 22,000 | 714 | |||||||
Okabe Co., Ltd. (Building products) | 155,600 | 1,412 | |||||||
Pigeon Corporation (Household products) | 81,100 | 4,729 | |||||||
Resorttrust, Inc. (Hotels, restaurants & leisure) | 146,400 | 3,205 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 79 |
International Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Japan—(continued) | |||||||||
Ryohin Keikaku Co., Ltd. (Multiline retail) | 26,900 | $ | 3,315 | ||||||
SCSK Corporation (IT services) | 126,400 | 3,166 | |||||||
Seven Bank, Ltd. (Banks) | 1,508,300 | 6,331 | |||||||
Start Today Co., Ltd. (Internet & catalog retail) | 143,600 | 2,984 | |||||||
Tadano, Ltd. (Machinery) | 269,000 | 3,323 | |||||||
The Hiroshima Bank, Ltd. (Banks) | 589,000 | 2,803 | |||||||
Topcon Corporation (Electronic equipment, instruments & components) | 344,600 | 7,308 | |||||||
Tsubakimoto Chain Co. (Machinery) | 1,105,000 | 8,881 | |||||||
Zenkoku Hosho Co., Ltd. (Diversified financial services) | 261,400 | 7,418 | |||||||
147,169 | |||||||||
United Kingdom—12.8% | |||||||||
Abcam plc (Biotechnology) | 488,645 | 3,540 | |||||||
AVEVA Group plc (Software) | 144,147 | 2,944 | |||||||
Bellway plc (Household durables) | 279,522 | 8,383 | |||||||
Berendsen plc (Commercial services & supplies) | 192,052 | 3,283 | |||||||
Big Yellow Group plc (Real estate investment trusts (REITs)) | 235,845 | 2,222 | |||||||
* | boohoo.com plc (Internet & catalog retail) | 2,320,677 | 1,417 | ||||||
Domino’s Pizza Group plc (Hotels, restaurants & leisure) | 453,402 | 4,951 | |||||||
Great Portland Estates plc (Real estate investment trusts (REITs)) | 758,816 | 8,656 | |||||||
Halfords Group plc (Specialty retail) | 408,125 | 2,978 | |||||||
Hays plc (Professional services) | 1,464,545 | 3,295 | |||||||
Man Group plc (Capital markets) | 1,008,124 | 2,509 | |||||||
Micro Focus International plc (Software) | 175,219 | 2,950 | |||||||
* | Optimal Payments plc (IT services) | 262,084 | 1,391 | ||||||
Provident Financial plc (Consumer finance) | 234,681 | 8,958 | |||||||
Rightmove plc (Media) | 83,281 | 2,904 | |||||||
St James’s Place plc (Insurance) | 257,961 | 3,253 | |||||||
Ted Baker plc (Textiles, apparel & luxury goods) | 46,530 | 1,597 | |||||||
The Restaurant Group plc (Hotels, restaurants & leisure) | 460,277 | 4,692 | |||||||
Victrex plc (Chemicals) | 73,264 | 2,364 | |||||||
WH Smith plc (Specialty retail) | 184,477 | 3,858 | |||||||
Workspace Group plc (Real estate investment trusts (REITs)) | 331,555 | 3,919 | |||||||
80,064 | |||||||||
Emerging Asia—11.2% | |||||||||
China—4.0% | |||||||||
ANTA Sports Products, Ltd. (Textiles, apparel & luxury goods) | 1,288,000 | 2,264 | |||||||
* | Hollysys Automation Technologies, Ltd. (Electronic equipment, instruments & components)† | 177,333 | 4,332 | ||||||
* | Luye Pharma Group, Ltd. (Pharmaceuticals) | 2,864,000 | 3,661 | ||||||
* | PAX Global Technology, Ltd. (Electronic equipment, instruments & components) | 1,739,000 | 1,781 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
China—(continued) | |||||||||
* | TAL Education Group—ADR (Diversified consumer services) | 97,661 | $ | 2,743 | |||||
Towngas China Co., Ltd. (Gas utilities) | 2,701,000 | 2,737 | |||||||
* | WuXi PharmaTech Cayman, Inc.—ADR (Life sciences tools & services) | 84,397 | 2,842 | ||||||
* | YY, Inc.—ADR (Internet software & services) | 69,756 | 4,349 | ||||||
24,709 | |||||||||
India—3.5% | |||||||||
Apollo Tyres, Ltd. (Auto components) | 1,760,026 | 6,201 | |||||||
Federal Bank, Ltd. (Banks) | 1,329,848 | 3,184 | |||||||
Motherson Sumi Systems, Ltd. (Auto components) | 268,028 | 1,936 | |||||||
Voltas, Ltd. (Construction & engineering) | 567,436 | 2,171 | |||||||
Yes Bank, Ltd. (Banks) | 704,176 | 8,545 | |||||||
22,037 | |||||||||
Indonesia—0.6% | |||||||||
PT Matahari Department Store Tbk (Multiline retail) | 3,112,000 | 3,750 | |||||||
Malaysia—0.3% | |||||||||
Silverlake Axis, Ltd. (Software) | 2,144,000 | 2,024 | |||||||
Philippines—0.8% | |||||||||
Megaworld Corporation (Real estate management & development) | 28,170,000 | 2,911 | |||||||
Robinsons Retail Holdings, Inc. (Food & staples retailing) | 1,117,460 | 1,888 | |||||||
4,799 | |||||||||
Taiwan—0.9% | |||||||||
Eclat Textile Co., Ltd. (Textiles, apparel & luxury goods) | 303,000 | 3,045 | |||||||
King Slide Works Co., Ltd. (Machinery) | 179,000 | 2,280 | |||||||
5,325 | |||||||||
Thailand—1.1% | |||||||||
Minor International PCL (Hotels, restaurants & leisure) | 4,321,800 | 4,239 | |||||||
Quality Houses PCL (Real estate management & development) | 25,265,000 | 2,789 | |||||||
7,028 | |||||||||
Canada—8.5% | |||||||||
* | Bankers Petroleum, Ltd. (Oil, gas & consumable fuels) | 657,514 | 1,845 | ||||||
Canadian Energy Services & Technology Corporation (Energy equipment & services) | 545,310 | 2,980 | |||||||
Canadian Western Bank (Banks) | 86,331 | 2,434 | |||||||
Constellation Software, Inc. (Software) | 6,373 | 1,895 | |||||||
Entertainment One, Ltd. (Media) | 574,661 | 2,872 | |||||||
Home Capital Group, Inc. (Thrifts & mortgage finance) | 187,285 | 7,736 | |||||||
Intertape Polymer Group, Inc. (Containers & packaging) | 175,831 | 2,817 |
See accompanying Notes to Financial Statements.
80 | Annual Report | December 31, 2014 |
International Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Canada—(continued) | |||||||||
Linamar Corporation (Auto components) | 139,795 | $ | 8,537 | ||||||
Mullen Group, Ltd. (Energy equipment & services) | 33,477 | 614 | |||||||
Peyto Exploration & Development Corporation (Oil, gas & consumable fuels) | 156,621 | 4,512 | |||||||
ShawCor, Ltd. (Energy equipment & services) | 123,495 | 4,507 | |||||||
The Jean Coutu Group PJC, Inc. Class “A” (Food & staples retailing) | 132,770 | 3,235 | |||||||
Total Energy Services, Inc. (Energy equipment & services) | 84,304 | 942 | |||||||
WestJet Airlines, Ltd. (Airlines) | 268,487 | 7,783 | |||||||
52,709 | |||||||||
Asia—5.7% | |||||||||
Australia—3.8% | |||||||||
Beach Energy, Ltd. (Oil, gas & consumable fuels) | 2,543,355 | 2,157 | |||||||
Challenger, Ltd. (Diversified financial services) | 1,010,101 | 5,336 | |||||||
Domino’s Pizza Enterprises, Ltd. (Hotels, restaurants & leisure) | 126,321 | 2,572 | |||||||
DuluxGroup, Ltd. (Chemicals) | 1,243,370 | 5,851 | |||||||
Magellan Financial Group, Ltd. (Capital markets) | 581,051 | 7,739 | |||||||
23,655 | |||||||||
New Zealand—1.9% | |||||||||
Fisher & Paykel Healthcare Corp., Ltd. (Health care equipment & supplies) | 1,248,456 | 6,076 | |||||||
SKY Network Television, Ltd. (Media) | 1,236,287 | 5,804 | |||||||
11,880 | |||||||||
Emerging Europe, Mid-East, Africa—4.0% | |||||||||
South Africa—2.8% | |||||||||
Clicks Group, Ltd. (Food & staples retailing) | 710,447 | 4,967 | |||||||
Coronation Fund Managers, Ltd. (Capital markets) | 542,623 | 5,370 | |||||||
Life Healthcare Group Holdings, Ltd. (Health care providers & services) | 1,094,529 | 4,044 | |||||||
Rand Merchant Insurance Holdings, Ltd. (Insurance) | 872,574 | 3,076 | |||||||
17,457 | |||||||||
Turkey—1.2% | |||||||||
* | Pegasus Hava Tasimaciligi A.S. (Airlines) | 313,607 | 4,435 | ||||||
Turkiye Sinai Kalkinma Bankasi A.S. (Banks) | 3,464,778 | 2,981 | |||||||
7,416 |
Issuer | Shares/ Principal Amount/ Contracts | Value | |||||||
Emerging Latin America—2.7% | |||||||||
Brazil—1.0% | |||||||||
CETIP S.A. - Mercados Organizados (Capital markets) | 242,000 | $ | 2,947 | ||||||
* | Qualicorp S.A. (Health care providers & services) | 322,100 | 3,377 | ||||||
6,324 | |||||||||
Mexico—1.7% | |||||||||
* | Compartamos S.A.B. de C.V. (Consumer finance) | 2,946,400 | 5,921 | ||||||
Gruma S.A.B. de C.V. (Food products) | 428,400 | 4,581 | |||||||
10,502 | |||||||||
Total Common Stocks—99.0% (cost $587,973) | 616,552 | ||||||||
Warrants | |||||||||
Emerging Asia—0.0% | |||||||||
Thailand—0.0% | |||||||||
* | Minor International PCL (Hotels, restaurants & leisure) | 4,910 | 1 | ||||||
Total Warrants—0.0% (cost $0) | 1 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $2,895, collateralized by Federal Farm Credit Bank, 2.700%, due 12/2/24 | $ | 2,895 | 2,895 | ||||||
Total Repurchase Agreement—0.4% (cost $2,895) | 2,895 | ||||||||
Total Investments—99.4% (cost $590,868) | 619,448 | ||||||||
Cash and other assets, less liabilities—0.6% | 3,492 | ||||||||
Net assets—100.0% | $ | 622,940 |
ADR = American Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 81 |
International Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 27.8 | % | ||
Consumer Discretionary | 18.8 | % | ||
Industrials | 17.3 | % | ||
Health Care | 9.7 | % | ||
Information Technology | 9.6 | % | ||
Consumer Staples | 6.9 | % | ||
Materials | 6.7 | % | ||
Energy | 2.8 | % | ||
Utilities | 0.4 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
Japanese Yen | 23.9 | % | ||
Euro | 15.6 | % | ||
British Pound Sterling | 15.2 | % | ||
Canadian Dollar | 8.1 | % | ||
Australian Dollar | 3.8 | % | ||
Indian Rupee | 3.6 | % | ||
Swiss Franc | 3.4 | % | ||
Danish Krone | 3.2 | % | ||
U.S. Dollar | 3.1 | % | ||
Swedish Krona | 3.1 | % | ||
South African Rand | 2.8 | % | ||
Hong Kong Dollar | 2.2 | % | ||
New Zealand Dollar | 1.9 | % | ||
Mexican Peso | 1.7 | % | ||
Norwegian Krone | 1.6 | % | ||
Turkish Lira | 1.2 | % | ||
Thai Baht | 1.1 | % | ||
Brazilian Real | 1.0 | % | ||
All Other Currencies | 3.5 | % | ||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
82 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 83 |
EMERGING MARKETS LEADERS FUND
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 |
Since | ||||||||||||||||
1 Year | 3 Year | 5 Year | Inception | |||||||||||||
Class N (b) | 2.17 | % | 6.87 | % | — | 3.29 | % | |||||||||
Class I (a) | 2.62 | 7.16 | 4.19 | 0.72 | ||||||||||||
Institutional Class (a) | 2.68 | 7.33 | 4.32 | 0.85 | ||||||||||||
MSCI Emerging Markets Index (net) (a) | (2.19 | ) | 4.04 | 1.78 | 0.29 |
(a) | Since Inception is for the period from March 26, 2008 (Commencement of Operations) to December 31, 2014. |
(b) | Since Inception for Class N is for the period from May 3, 2010 (Commencement of Operations) to December 31, 2014. The corresponding benchmark inception return for the MSCI Emerging Markets Index (net) is 1.37%. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) fees. Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) Emerging Markets Index (net) is a free float-adjusted market-capitalization-weighted index that is designed to measure equity market performance of emerging markets. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
84 | Annual Report | December 31, 2014 |
Emerging Markets Leaders Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Emerging Asia—63.1% | |||||||||
China—24.1% | |||||||||
Air China, Ltd. (Airlines) | 636,000 | $ | 511 | ||||||
* | Alibaba Group Holding, Ltd.—ADR (Internet software & services) | 19,178 | 1,993 | ||||||
* | Baidu, Inc.—ADR (Internet software & services) | 14,327 | 3,266 | ||||||
Brilliance China Automotive Holdings, Ltd. (Automobiles) | 870,000 | 1,386 | |||||||
* | China CNR Corporation Ltd.—144A (Machinery) | 1,377,500 | 1,972 | ||||||
China Gas Holdings, Ltd. (Gas utilities) | 602,000 | 949 | |||||||
China Merchants Bank Co., Ltd. Class “H” (Banks) | 814,000 | 2,032 | |||||||
China Overseas Land & Investment, Ltd. (Real estate management & development) | 572,000 | 1,696 | |||||||
CITIC Securities Co., Ltd. (Capital markets) | 149,000 | 557 | |||||||
CNOOC, Ltd. (Oil, gas & consumable fuels) | 1,238,000 | 1,674 | |||||||
ENN Energy Holdings, Ltd. (Gas utilities) | 32,000 | 181 | |||||||
Lenovo Group, Ltd. (Technology hardware, storage & peripherals) | 1,304,000 | 1,713 | |||||||
NetEase, Inc.—ADR (Internet software & services) | 8,876 | 880 | |||||||
Ping An Insurance Group Co. of China, Ltd. Class “H” (Insurance) | 209,500 | 2,119 | |||||||
Sihuan Pharmaceutical Holdings Group, Ltd. (Pharmaceuticals) | 769,000 | 514 | |||||||
Sinopharm Group Co., Ltd. (Health care providers & services) | 298,600 | 1,053 | |||||||
Tencent Holdings, Ltd. (Internet software & services) | 98,000 | 1,418 | |||||||
* | Vipshop Holdings, Ltd.—ADR (Internet & catalog retail) | 84,050 | 1,642 | ||||||
25,556 | |||||||||
India—16.3% | |||||||||
Adani Ports & Special Economic Zone, Ltd. (Transportation infrastructure) | 246,173 | 1,243 | |||||||
Axis Bank, Ltd. (Banks) | 165,822 | 1,311 | |||||||
HCL Technologies, Ltd. (IT services) | 41,050 | 1,041 | |||||||
HDFC Bank, Ltd. (Banks) | 146,888 | 2,204 | |||||||
Hero MotoCorp, Ltd. (Automobiles) | 27,384 | 1,341 | |||||||
Housing Development Finance Corporation (Thrifts & mortgage finance) | 121,064 | 2,165 | |||||||
Lupin, Ltd. (Pharmaceuticals) | 47,025 | 1,063 | |||||||
Mahindra & Mahindra, Ltd. (Automobiles) | 24,268 | 473 | |||||||
Maruti Suzuki India, Ltd. (Automobiles) | 20,831 | 1,096 | |||||||
Sun Pharmaceutical Industries, Ltd. (Pharmaceuticals) | 127,480 | 1,667 | |||||||
Tata Consultancy Services, Ltd. (IT services) | 38,706 | 1,571 | |||||||
Tata Motors, Ltd. (Automobiles) | 200,258 | 1,566 | |||||||
Ultratech Cement, Ltd. (Construction materials) | 13,315 | 562 | |||||||
17,303 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
Indonesia—3.3% | |||||||||
PT Astra International Tbk (Automobiles) | 975,900 | $ | 582 | ||||||
PT Bank Rakyat Indonesia Persero Tbk (Banks) | 2,168,200 | 2,038 | |||||||
PT Kalbe Farma Tbk (Pharmaceuticals) | 5,789,600 | 854 | |||||||
3,474 | |||||||||
Philippines—0.6% | |||||||||
Universal Robina Corporation (Food products) | 152,570 | 665 | |||||||
South Korea—10.4% | |||||||||
* | Coway Co., Ltd. (Household durables) | 8,864 | 676 | ||||||
* | LG Household & Health Care, Ltd. (Household products) | 1,673 | 949 | ||||||
* | NAVER Corporation (Internet software & services) | 754 | 483 | ||||||
Samsung Electronics Co., Ltd. (Technology hardware, storage & peripherals) | 3,306 | 3,975 | |||||||
* | Samsung Fire & Marine Insurance Co., Ltd. (Insurance) | 10,243 | 2,628 | ||||||
* | SK Hynix, Inc. (Semiconductors & semiconductor equipment) | 54,570 | 2,332 | ||||||
11,043 | |||||||||
Taiwan—4.3% | |||||||||
Fubon Financial Holding Co., Ltd. (Diversified financial services) | 1,059,000 | 1,686 | |||||||
MediaTek, Inc. (Semiconductors & semiconductor equipment) | 36,000 | 523 | |||||||
Taiwan Semiconductor Manufacturing Co., Ltd.—ADR (Semiconductors & semiconductor equipment) | 105,303 | 2,357 | |||||||
4,566 | |||||||||
Thailand—4.1% | |||||||||
Advanced Info Service PCL (Wireless telecommunication services) | 113,100 | 858 | |||||||
Airports of Thailand PCL (Transportation infrastructure) | 147,600 | 1,258 | |||||||
Kasikornbank PCL (Banks) | 221,800 | 1,535 | |||||||
Thai Beverage PCL (Beverages) | 1,363,000 | 707 | |||||||
4,358 | |||||||||
Emerging Europe, Mid-East, Africa—19.1% | |||||||||
Russia—1.2% | |||||||||
Magnit PJSC—144A—GDR (Food & staples retailing)† | 28,759 | 1,300 | |||||||
South Africa—12.3% | |||||||||
* | Aspen Pharmacare Holdings, Ltd. (Pharmaceuticals) | 68,756 | 2,399 | ||||||
Bidvest Group, Ltd. (Industrial conglomerates) | 63,379 | 1,657 | |||||||
Discovery, Ltd. (Insurance) | 59,229 | 567 | |||||||
FirstRand, Ltd. (Diversified financial services) | 485,985 | 2,113 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 85 |
Emerging Markets Leaders Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Europe, Mid-East, Africa—(continued) | |||||||||
South Africa—(continued) | |||||||||
Mediclinic International, Ltd. (Health care providers & services) | 94,054 | $ | 814 | ||||||
MTN Group, Ltd. (Wireless telecommunication services) | 53,839 | 1,024 | |||||||
Naspers, Ltd. (Media) | 19,925 | 2,578 | |||||||
Sanlam, Ltd. (Insurance) | 86,121 | 518 | |||||||
Sasol, Ltd. (Oil, gas & consumable fuels) | 35,886 | 1,339 | |||||||
13,009 | |||||||||
Turkey—3.3% | |||||||||
KOC Holding A.S. (Industrial conglomerates) | 205,788 | 1,088 | |||||||
Turkiye Garanti Bankasi A.S. (Banks) | 613,046 | 2,463 | |||||||
3,551 | |||||||||
United Arab Emirates—2.3% | |||||||||
DP World, Ltd. (Transportation infrastructure) | 36,716 | 767 | |||||||
* | Emaar Malls Group PJSC (Real estate management & development) | 650,160 | 474 | ||||||
Emaar Properties PJSC (Real estate management & development) | 367,932 | 709 | |||||||
First Gulf Bank PJSC (Banks) | 116,231 | 534 | |||||||
2,484 | |||||||||
Emerging Latin America—14.3% | |||||||||
Brazil—7.3% | |||||||||
AMBEV S.A.—ADR (Beverages) | 246,106 | 1,531 | |||||||
BB Seguridade Participacoes S.A. (Insurance) | 175,600 | 2,119 | |||||||
BR Malls Participacoes S.A. (Real estate management & development) | 81,500 | 508 | |||||||
BRF S.A. (Food products) | 56,000 | 1,333 | |||||||
CETIP S.A. - Mercados Organizados (Capital markets) | 38,200 | 465 | |||||||
Kroton Educacional S.A. (Diversified consumer services) | 194,900 | 1,136 | |||||||
Weg S.A. (Machinery) | 54,850 | 632 | |||||||
7,724 | |||||||||
Chile—0.7% | |||||||||
Banco Santander Chile—ADR (Banks) | 38,457 | 758 | |||||||
Mexico—4.8% | |||||||||
* | Alfa S.A.B. de C.V. (Industrial conglomerates) | 448,900 | 1,003 | ||||||
* | Cemex S.A.B. de C.V. (Construction materials) | 1,235,300 | 1,261 | ||||||
Fibra Uno Administracion S.A. de C.V. (Real estate investment trusts (REITs)) | 462,070 | 1,362 | |||||||
Grupo Financiero Inbursa S.A.B. de C.V. (Banks) | 381,200 | 989 | |||||||
Wal-Mart de Mexico S.A.B. de C.V. (Food & staples retailing) | 234,800 | 505 | |||||||
5,120 |
Shares or | |||||||||
Principal | |||||||||
Issuer | Amount | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Latin America—(continued) | |||||||||
Peru—1.5% | |||||||||
Credicorp, Ltd. (Banks)† | 9,722 | $ | 1,557 | ||||||
Total Common Stocks—96.5% (cost $99,311) | 102,468 | ||||||||
Preferred Stock | |||||||||
Brazil—1.8% | |||||||||
Itau Unibanco Holding S.A. (Banks) | 143,670 | 1,883 | |||||||
Total Preferred Stock—1.8% (cost $1,951) | 1,883 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $2,209, collateralized by Federal Home Loan Bank, 5.250%, due 6/12/37 | $ | 2,209 | 2,209 | ||||||
Total Repurchase Agreement—2.1% (cost $2,209) | 2,209 | ||||||||
Total Investments—100.4% (cost $103,471) | 106,560 | ||||||||
Liabilities, plus cash and other assets—(0.4)% | (378 | ) | |||||||
Net assets—100.0% | $ | 106,182 |
ADR = American Depository Receipt
GDR = Global Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
See accompanying Notes to Financial Statements.
86 | Annual Report | December 31, 2014 |
Emerging Markets Leaders Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 35.4 | % | ||
Information Technology | 20.7 | % | ||
Consumer Discretionary | 12.0 | % | ||
Industrials | 9.7 | % | ||
Health Care | 8.0 | % | ||
Consumer Staples | 6.7 | % | ||
Energy | 2.9 | % | ||
Telecommunication Services | 1.8 | % | ||
Materials | 1.7 | % | ||
Utilities | 1.1 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
Hong Kong Dollar | 17.0 | % | ||
Indian Rupee | 16.6 | % | ||
U.S. Dollar | 15.4 | % | ||
South African Rand | 12.5 | % | ||
South Korean Won | 10.6 | % | ||
Brazilian Real | 7.7 | % | ||
Mexican Peso | 4.9 | % | ||
Thai Baht | 3.5 | % | ||
Turkish Lira | 3.4 | % | ||
Indonesian Rupiah | 3.3 | % | ||
New Taiwan Dollar | 2.1 | % | ||
UAE Dirham | 1.7 | % | ||
All Other Currencies | 1.3 | % | ||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 87 |
88 | Annual Report | December 31, 2014 |
Emerging Markets Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | Since Inception(a) | |||||||||||||
Class N | 3.40 | % | 8.04 | % | 5.19 | % | 9.19 | % | ||||||||
Class I | 3.65 | 8.33 | 5.48 | 9.47 | ||||||||||||
Institutional Class | 3.85 | 8.53 | 5.67 | 9.66 | ||||||||||||
MSCI Emerging Markets IMI (net) | (1.79 | ) | 4.46 | 1.93 | 8.54 |
(a) | For the period from June 6, 2005 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company L.L.C. without a sales load or distribution (12b-1) fees. Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) Emerging Markets Investable Market Index (IMI) (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of emerging markets. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 89 |
Emerging Markets Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Emerging Asia—60.0% | |||||||||
China—20.0% | |||||||||
Air China, Ltd. (Airlines) | 5,884,000 | $ | 4,732 | ||||||
* | Alibaba Group Holding, Ltd.—ADR (Internet software & services) | 121,025 | 12,579 | ||||||
* | Baidu, Inc.—ADR (Internet software & services) | 64,303 | 14,659 | ||||||
Beijing Enterprises Water Group, Ltd. (Water utilities) | 6,896,000 | 4,642 | |||||||
Brilliance China Automotive Holdings, Ltd. (Automobiles) | 5,394,000 | 8,595 | |||||||
China Everbright International, Ltd. (Commercial services & supplies) | 1,687,000 | 2,512 | |||||||
China Gas Holdings, Ltd. (Gas utilities) | 5,186,000 | 8,175 | |||||||
China Merchants Bank Co., Ltd. Class “H” (Banks) | 4,378,500 | 10,929 | |||||||
* | China Vanke Co., Ltd. (Real estate management & development) | 6,361,500 | 14,079 | ||||||
CIMC Enric Holdings, Ltd. (Machinery) | 2,084,000 | 1,647 | |||||||
CITIC Securities Co., Ltd. Class “H” (Capital markets) | 677,000 | 2,530 | |||||||
CNOOC, Ltd. (Oil, gas & consumable fuels) | 11,378,000 | 15,385 | |||||||
ENN Energy Holdings, Ltd. (Gas utilities) | 144,000 | 815 | |||||||
Haier Electronics Group Co., Ltd. (Household durables) | 897,000 | 2,131 | |||||||
Huaneng Renewables Corporation, Ltd. Class “H” (Independent power & renewable electricity producers) | 7,031,932 | 2,256 | |||||||
Lenovo Group, Ltd. (Technology hardware, storage & peripherals) | 10,312,000 | 13,543 | |||||||
* | Luye Pharma Group, Ltd. (Pharmaceuticals) | 1,951,000 | 2,494 | ||||||
NetEase, Inc.—ADR (Internet software & services) | 131,598 | 13,047 | |||||||
Ping An Insurance Group Co. of China, Ltd. Class “H” (Insurance) | 2,338,500 | 23,649 | |||||||
Shanghai Fosun Pharmaceutical Group Co., Ltd. Class “H” (Pharmaceuticals) | 896,500 | 3,186 | |||||||
Sihuan Pharmaceutical Holdings Group, Ltd. (Pharmaceuticals) | 3,485,000 | 2,331 | |||||||
Sinopharm Group Co., Ltd. (Health care providers & services) | 1,192,800 | 4,205 | |||||||
Tencent Holdings, Ltd. (Internet software & services) | 914,780 | 13,236 | |||||||
* | Vipshop Holdings, Ltd.—ADR (Internet & catalog retail) | 204,734 | 4,001 | ||||||
* | WuXi PharmaTech Cayman, Inc.—ADR (Life sciences tools & services) | 85,831 | 2,890 | ||||||
* | YY, Inc.—ADR (Internet software & services) | 40,194 | 2,506 | ||||||
Zhuzhou CSR Times Electric Co., Ltd. Class “H” (Electrical equipment) | 1,076,000 | 6,251 | |||||||
197,005 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
India—16.5% | |||||||||
Adani Ports & Special Economic Zone, Ltd. | |||||||||
(Transportation infrastructure) | 781,944 | $ | 3,948 | ||||||
Apollo Hospitals Enterprise, Ltd. (Health | |||||||||
care providers & services) | 152,715 | 2,726 | |||||||
Axis Bank, Ltd. (Banks) | 618,227 | 4,887 | |||||||
HCL Technologies, Ltd. (IT services) | 493,449 | 12,518 | |||||||
HDFC Bank, Ltd. (Banks) | 1,487,466 | 22,323 | |||||||
Hero MotoCorp, Ltd. (Automobiles) | 108,955 | 5,335 | |||||||
Housing Development Finance Corporation (Thrifts & mortgage finance) | 860,825 | 15,397 | |||||||
IndusInd Bank, Ltd. (Banks) | 553,642 | 7,008 | |||||||
ITC, Ltd. (Tobacco) | 875,030 | 5,097 | |||||||
Larsen & Toubro, Ltd. (Construction & engineering) | 167,996 | 3,956 | |||||||
Lupin, Ltd. (Pharmaceuticals) | 496,001 | 11,214 | |||||||
Mahindra & Mahindra, Ltd. (Automobiles) | 122,747 | 2,391 | |||||||
Maruti Suzuki India, Ltd. (Automobiles) | 135,865 | 7,148 | |||||||
Sun Pharmaceutical Industries, Ltd. (Pharmaceuticals) | 1,092,219 | 14,281 | |||||||
Tata Consultancy Services, Ltd. (IT services) | 491,448 | 19,944 | |||||||
Tata Motors, Ltd. (Automobiles) | 1,862,776 | 14,564 | |||||||
Tech Mahindra, Ltd. (IT services) | 127,481 | 5,226 | |||||||
Ultratech Cement, Ltd. (Construction materials) | 108,351 | 4,574 | |||||||
162,537 | |||||||||
Indonesia—2.8% | |||||||||
PT Astra International Tbk (Automobiles) | 8,986,200 | 5,359 | |||||||
PT Bank Rakyat Indonesia Persero Tbk (Banks) | 17,626,621 | 16,569 | |||||||
PT Jasa Marga Persero Tbk (Transportation infrastructure) | 4,211,000 | 2,390 | |||||||
PT Kalbe Farma Tbk (Pharmaceuticals) | 24,116,815 | 3,555 | |||||||
27,873 | |||||||||
Papua New Guinea—0.8% | |||||||||
Oil Search, Ltd. (Oil, gas & consumable fuels) | 1,287,097 | 8,254 | |||||||
Philippines—0.7% | |||||||||
International Container Terminal Services, Inc. (Transportation infrastructure) | 913,320 | 2,334 | |||||||
Universal Robina Corporation (Food products) | 1,026,610 | 4,476 | |||||||
6,810 | |||||||||
South Korea—9.8% | |||||||||
Coway Co., Ltd. (Household durables) | 47,003 | 3,584 | |||||||
LG Household & Health Care, Ltd. (Household products) | 8,586 | 4,873 | |||||||
NAVER Corporation (Internet software & services) | 6,458 | 4,136 | |||||||
Samsung Electronics Co., Ltd. (Technology hardware, storage & peripherals) | 31,074 | 37,358 |
See accompanying Notes to Financial Statements.
90 | Annual Report | December 31, 2014 |
Emerging Markets Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
South Korea—(continued) | |||||||||
Samsung Fire & Marine Insurance Co., Ltd. (Insurance) | 65,974 | $ | 16,930 | ||||||
* | SK Hynix, Inc. (Semiconductors & semiconductor equipment) | 693,430 | 29,634 | ||||||
96,515 | |||||||||
Taiwan—6.3% | |||||||||
Advantech Co., Ltd. (Technology hardware, storage & peripherals) | 324,145 | 2,380 | |||||||
E.Sun Financial Holding Co., Ltd. (Banks) | 4,175,995 | 2,588 | |||||||
Fubon Financial Holding Co., Ltd. (Diversified financial services) | 12,079,560 | 19,227 | |||||||
Largan Precision Co., Ltd. (Electronic equipment, instruments & components) | 40,000 | 2,994 | |||||||
MediaTek, Inc. (Semiconductors & semiconductor equipment) | 345,000 | 5,015 | |||||||
Novatek Microelectronics Corporation (Semiconductors & semiconductor equipment) | 811,000 | 4,532 | |||||||
Taiwan Semiconductor Manufacturing Co., Ltd.—ADR (Semiconductors & semiconductor equipment) | 1,133,195 | 25,361 | |||||||
62,097 | |||||||||
Thailand—3.1% | |||||||||
Advanced Info Service PCL (Wireless telecommunication services) | 699,700 | 5,306 | |||||||
Airports of Thailand PCL (Transportation infrastructure) | 878,000 | 7,480 | |||||||
Central Pattana PCL (Real estate management & development) | 2,515,500 | 3,451 | |||||||
Kasikornbank PCL (Banks) | 1,332,200 | 9,222 | |||||||
Thai Beverage PCL (Beverages) | 5,068,000 | 2,631 | |||||||
Thai Union Frozen Products PCL (Food products) | 943,800 | 2,580 | |||||||
30,670 | |||||||||
Emerging Europe, Mid-East, Africa—18.5% | |||||||||
Greece—0.2% | |||||||||
JUMBO S.A. (Specialty retail) | 206,013 | 2,095 | |||||||
Qatar—0.5% | |||||||||
Qatar National Bank S.A.Q. (Banks) | 86,185 | 5,006 | |||||||
Russia—1.2% | |||||||||
Magnit PJSC—144A—GDR (Food & staples retailing)† | 218,300 | 9,866 | |||||||
* | Mail.ru Group Ltd.—144A—GDR (Internet software & services)† | 17,861 | 288 | ||||||
* | Mail.ru Group, Ltd.—GDR (Internet software & services) | 101,266 | 1,635 | ||||||
11,789 | |||||||||
South Africa—9.3% | |||||||||
Aspen Pharmacare Holdings, Ltd. (Pharmaceuticals) | 240,625 | 8,395 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Europe, Mid-East, Africa—(continued) | |||||||||
South Africa—(continued) | |||||||||
Bidvest Group, Ltd. (Industrial conglomerates) | 195,803 | $ | 5,119 | ||||||
Discovery, Ltd. (Insurance) | 269,859 | 2,584 | |||||||
FirstRand, Ltd. (Diversified financial services) | 3,919,857 | 17,040 | |||||||
Life Healthcare Group Holdings, Ltd. (Health care providers & services) | 1,239,378 | 4,578 | |||||||
Mr. Price Group, Ltd. (Specialty retail) | 161,032 | 3,258 | |||||||
MTN Group, Ltd. (Wireless telecommunication services) | 491,077 | 9,342 | |||||||
Naspers, Ltd. (Media) | 186,722 | 24,153 | |||||||
Sanlam, Ltd. (Insurance) | 386,923 | 2,328 | |||||||
Sasol, Ltd. (Oil, gas & consumable fuels) | 405,391 | 15,130 | |||||||
91,927 | |||||||||
Turkey—3.9% | |||||||||
KOC Holding A.S. (Industrial conglomerates) | 1,903,857 | 10,068 | |||||||
* | Pegasus Hava Tasimaciligi A.S. (Airlines) | 168,668 | 2,386 | ||||||
TAV Havalimanlari Holding A.S. (Transportation infrastructure) | 288,082 | 2,352 | |||||||
Turkiye Garanti Bankasi A.S. (Banks) | 5,864,690 | 23,559 | |||||||
38,365 | |||||||||
United Arab Emirates—3.4% | |||||||||
Air Arabia PJSC (Airlines) | 5,688,780 | 2,290 | |||||||
DAMAC Real Estate Development Ltd.—144A—GDR (Real estate management & development) | 137,831 | 1,875 | |||||||
DP World, Ltd. (Transportation infrastructure) | 260,263 | 5,437 | |||||||
Dragon Oil plc (Oil, gas & consumable fuels) | 472,523 | 3,958 | |||||||
Dubai Islamic Bank PJSC (Banks) | 1,940,161 | 3,563 | |||||||
* | Emaar Malls Group PJSC (Real estate management & development) | 5,997,777 | 4,376 | ||||||
Emaar Properties PJSC (Real estate management & development) | 3,394,348 | 6,542 | |||||||
First Gulf Bank PJSC (Banks) | 1,093,071 | 5,021 | |||||||
33,062 | |||||||||
Emerging Latin America—15.0% | |||||||||
Argentina—0.3% | |||||||||
MercadoLibre, Inc. (Internet software & services) | 26,133 | 3,336 | |||||||
Brazil—7.2% | |||||||||
AMBEV S.A.—ADR (Beverages) | 3,256,254 | 20,254 | |||||||
BB Seguridade Participacoes S.A. (Insurance) | 1,157,600 | 13,969 | |||||||
BR Malls Participacoes S.A. (Real estate management & development) | 767,090 | 4,784 | |||||||
BRF S.A. (Food products) | 261,000 | 6,212 | |||||||
CCR S.A (Transportation infrastructure) | 1,371,889 | 7,985 | |||||||
CETIP S.A.—Mercados Organizados (Capital markets) | 174,200 | 2,121 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 91 |
Emerging Markets Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Latin America—(continued) | |||||||||
Brazil—(continued) | |||||||||
Kroton Educacional S.A. (Diversified consumer services) | 702,820 | $ | 4,095 | ||||||
* | Qualicorp S.A. (Health care providers & services) | 208,400 | 2,185 | ||||||
Ultrapar Participacoes S.A. (Oil, gas & consumable fuels) | 308,300 | 5,975 | |||||||
Weg S.A. (Machinery) | 264,940 | 3,054 | |||||||
70,634 | |||||||||
Chile—1.1% | |||||||||
Banco Santander Chile—ADR (Banks) | 176,949 | 3,489 | |||||||
S.A.C.I. Falabella (Multiline retail) | 1,016,834 | 6,833 | |||||||
10,322 | |||||||||
Mexico—4.2% | |||||||||
Alfa S.A.B. de C.V. (Industrial conglomerates) | 3,199,500 | 7,150 | |||||||
* | Cemex S.A.B. de C.V. (Construction materials) | 9,457,600 | 9,654 | ||||||
Fibra Uno Administracion S.A. de C.V. (Real estate investment trusts (REITs)) | 2,181,369 | 6,432 | |||||||
Grupo Financiero Inbursa S.A.B. de C.V. (Banks) | 878,500 | 2,279 | |||||||
Infraestructura Energetica Nova S.A.B. de C.V. (Gas utilities) | 622,200 | 3,104 | |||||||
* | Promotora y Operadora de Infraestructura S.A.B. de C.V. (Construction & engineering) | 344,300 | 4,151 | ||||||
Wal-Mart de Mexico S.A.B. de C.V. (Food & staples retailing) | 4,184,500 | 8,999 | |||||||
41,769 | |||||||||
Panama—0.5% | |||||||||
Copa Holdings S.A. Class “A” (Airlines)† | 48,203 | 4,996 | |||||||
Peru—1.7% | |||||||||
Credicorp, Ltd. (Banks)† | 91,686 | 14,686 | |||||||
Intercorp Financial Services, Inc. (Banks) | 80,171 | 2,437 | |||||||
17,123 | |||||||||
Total Common Stocks—93.5% (cost $871,300) | 922,185 |
Shares or | |||||||||
Principal | |||||||||
Issuer | Amount | Value | |||||||
Preferred Stock | |||||||||
Brazil—1.4% | |||||||||
Itau Unibanco Holding S.A. (Banks) | 1,061,613 | $ | 13,911 | ||||||
Total Preferred Stock—1.4% (cost $13,506) | 13,911 | ||||||||
Affiliated Fund | |||||||||
Emerging Asia—3.6% | |||||||||
China—3.6% | |||||||||
William Blair China A-Share Fund, LLC | 2,362,400 | 35,507 | |||||||
Total Affiliated Fund—3.6% (cost $23,624) | 35,507 | ||||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $24,544, collateralized by Federal Farm Credit Bank, 2.700%, due 12/2/24 | $24,544 | 24,544 | |||||||
Total Repurchase Agreement—2.5% (cost $24,544) | 24,544 | ||||||||
Total Investments—101.0% (cost $932,974) | 996,147 | ||||||||
Liabilities, plus cash and other assets—(1.0)% | (10,313 | ) | |||||||
Net assets—100.0% | $ | 985,834 |
ADR = American Depository Receipt
GDR = Global Depository Receipt
* Non-income producing securities
† = U.S. listed foreign security
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
See accompanying Notes to Financial Statements.
92 | Annual Report | December 31, 2014 |
Emerging Markets Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 32.9 | % | ||
Information Technology | 23.2 | % | ||
Consumer Discretionary | 10.3 | % | ||
Industrials | 9.7 | % | ||
Consumer Staples | 6.9 | % | ||
Health Care | 6.7 | % | ||
Energy | 5.0 | % | ||
Utilities | 2.2 | % | ||
Materials | 1.6 | % | ||
Telecommunication Services | 1.5 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
U.S. Dollar | 18.1 | % | ||
Indian Rupee | 16.7 | % | ||
Hong Kong Dollar | 15.5 | % | ||
South Korean Won | 9.7 | % | ||
South African Rand | 9.5 | % | ||
Brazilian Real | 6.6 | % | ||
Mexican Peso | 4.3 | % | ||
Turkish Lira | 3.9 | % | ||
New Taiwan Dollar | 3.8 | % | ||
Thai Baht | 2.9 | % | ||
Indonesian Rupiah | 2.9 | % | ||
UAE Dirham | 2.2 | % | ||
All Other Currencies | 3.9 | % | ||
Total | 100.0 | % |
As of December 31, 2014, the Fund invested in William Blair China A-Share Fund, LLC, an affiliated fund. There are no unfunded commitments to the affiliated fund and the Fund may redeem its investment weekly.
Share Activity | Year Ended December 31, 2014 | |||||||||||||||||||||||||||||||
Change in net | ||||||||||||||||||||||||||||||||
unrealized | ||||||||||||||||||||||||||||||||
Balance | Balance | Dividend | Net realized | appreciation | ||||||||||||||||||||||||||||
Fund Name | 12/31/2013 | Purchases | Sales | 12/31/2014 | Value | Income | gain (loss) | (depreciation) | ||||||||||||||||||||||||
William Blair China A-Share Fund, LLC | 2,362,400 | — | — | 2,362,400 | $35,507 | $ — | $ — | $ 7,725 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 93 |
94 | Annual Report | December 31, 2014 |
Emerging Markets Small Cap Growth Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||
Since | ||||||||||||
1 Year | 3 Year | Inception | ||||||||||
Class N(a) | 14.41 | % | 21.37 | % | 18.96 | % | ||||||
Class I(a) | 14.73 | 21.70 | 19.26 | |||||||||
MSCI Emerging Markets Small Cap Index (net)(a) | 1.01 | 7.65 | 5.01 | |||||||||
Institutional Class(b) | 14.85 | — | 16.47 | |||||||||
MSCI Emerging Markets Small Cap Index (net)(b) | 1.01 | — | 1.72 |
(a) | Since inception is for the period from October 24, 2011 (Commencement of Operations) to December 31, 2014. |
(b) | Since inception is for the period from December 20, 2012 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. International investing involves special risk considerations, including currency fluctuations, lower liquidity, economic and political risk. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company L.L.C. without a sales load or distribution (12b-1) fees. Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Morgan Stanley Capital International (MSCI) Emerging Markets Small Cap Index (net) is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of emerging markets. This series approximates the minimum possible dividend reinvestment.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all stocks in the Fund performed the same, nor is there any guarantee that these stocks will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total long-term securities.
December 31, 2014 | William Blair Funds | 95 |
Emerging Markets Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks | |||||||||
Emerging Asia—74.8% | |||||||||
China—18.3% | |||||||||
Anta Sports Products, Ltd. (Textiles, apparel & luxury goods) | 144,000 | $ | 253 | ||||||
* | Beijing Enterprises Water Group, Ltd. (Water utilities) | 3,966,000 | 2,670 | ||||||
* | Bitauto Holdings, Ltd.—ADR (Internet software & services) | 15,552 | 1,095 | ||||||
* | CAR, Inc. (Road & rail) | 734,000 | 982 | ||||||
* | China Biologic Products, Inc. (Biotechnology) | 15,427 | 1,037 | ||||||
China Distance Education Holdings, Ltd.—ADR (Diversified consumer services) | 81,273 | 1,332 | |||||||
China Everbright International, Ltd. (Commercial services & supplies) | 1,620,000 | 2,413 | |||||||
China Medical System Holdings, Ltd. (Pharmaceuticals) | 1,999,000 | 3,273 | |||||||
* | China Singyes Solar Technologies Holdings, Ltd. (Construction & engineering) | 502,000 | 696 | ||||||
* | Cosmo Lady China Holdings Co. Ltd.—144A (Textiles, apparel & luxury goods) | 1,092,497 | 741 | ||||||
CT Environmental Group, Ltd. (Water utilities) | 2,388,000 | 2,435 | |||||||
Dawnrays Pharmaceutical Holdings, Ltd. (Pharmaceuticals) | 1,860,000 | 1,179 | |||||||
* | Hollysys Automation Technologies, Ltd. (Electronic equipment, instruments & components)† | 169,012 | 4,129 | ||||||
* | iKang Healthcare Group, Inc.—ADR (Health care providers & services) | 53,652 | 807 | ||||||
Jintian Pharmaceutical Group, Ltd. (Health care providers & services) | 4,092,000 | 1,385 | |||||||
* | Luye Pharma Group, Ltd. (Pharmaceuticals) | 1,371,000 | 1,752 | ||||||
Minth Group, Ltd. (Auto components) | 318,000 | 656 | |||||||
* | Ozner Water International Holding Ltd.—144A (Household durables) | 2,517,000 | 967 | ||||||
* | PAX Global Technology, Ltd. (Electronic equipment, instruments & components) | 3,338,000 | 3,419 | ||||||
Shenzhen International Holdings, Ltd. (Transportation infrastructure) | 974,500 | 1,421 | |||||||
Sino Biopharmaceutical, Ltd. (Pharmaceuticals) | 1,112,000 | 1,008 | |||||||
* | Sound Global, Ltd. (Water utilities) | 1,611,000 | 1,862 | ||||||
Sunny Optical Technology Group Co., Ltd. (Electronic equipment, instruments & components) | 838,000 | 1,439 | |||||||
* | TAL Education Group—ADR (Diversified consumer services) | 32,018 | 899 | ||||||
* | Tarena International, Inc.—ADR (Diversified consumer services) | 65,639 | 729 | ||||||
Wasion Group Holdings, Ltd. (Electronic equipment, instruments & components) | 1,632,000 | 1,515 | |||||||
* | WuXi PharmaTech Cayman, Inc.—ADR (Life sciences tools & services) | 45,186 | 1,521 | ||||||
Zhuzhou CSR Times Electric Co., Ltd. Class “H” (Electrical equipment) | 851,000 | 4,944 | |||||||
46,559 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
India—27.2% | |||||||||
AIA Engineering, Ltd. (Machinery) | 90,786 | $ | 1,562 | ||||||
Ajanta Pharma, Ltd. (Pharmaceuticals) | 19,652 | 722 | |||||||
Alembic Pharmaceuticals, Ltd. (Pharmaceuticals) | 290,305 | 2,035 | |||||||
Amara Raja Batteries, Ltd. (Electrical equipment) | 88,080 | 1,149 | |||||||
Apollo Tyres, Ltd. (Auto components) | 506,071 | 1,783 | |||||||
Bata India, Ltd. (Textiles, apparel & luxury goods) | 56,397 | 1,164 | |||||||
Berger Paints India, Ltd. (Chemicals) | 223,403 | 1,427 | |||||||
Bharat Forge, Ltd. (Auto components) | 140,894 | 2,095 | |||||||
Bharti Infratel, Ltd. (Wireless telecommunication services) | 264,608 | 1,405 | |||||||
Blue Dart Express, Ltd. (Air freight & logistics) | 20,745 | 2,080 | |||||||
Britannia Industries, Ltd. (Food products) | 54,598 | 1,584 | |||||||
Cadila Healthcare, Ltd. (Pharmaceuticals) | 70,518 | 1,799 | |||||||
Colgate-Palmolive India, Ltd. (Personal products) | 44,073 | 1,247 | |||||||
Eicher Motors, Ltd. (Machinery) | 7,873 | 1,860 | |||||||
Emami, Ltd. (Personal products) | 88,568 | 1,100 | |||||||
Federal Bank, Ltd. (Banks) | 934,718 | 2,238 | |||||||
Finolex Industries, Ltd. (Chemicals) | 159,177 | 659 | |||||||
Gateway Distriparks, Ltd. (Transportation infrastructure) | 93,841 | 521 | |||||||
Gruh Finance, Ltd. (Thrifts & mortgage finance) | 574,099 | 2,476 | |||||||
* | Gujarat Pipavav Port, Ltd. (Transportation infrastructure) | 323,283 | 1,050 | ||||||
Havells India, Ltd. (Electrical equipment) | 460,329 | 2,000 | |||||||
IndusInd Bank, Ltd. (Banks) | 427,904 | 5,416 | |||||||
Kajaria Ceramics, Ltd. (Building products) | 128,275 | 1,209 | |||||||
Kaveri Seed Co., Ltd. (Food products) | 143,716 | 1,752 | |||||||
LIC Housing Finance, Ltd. (Thrifts & mortgage finance) | 409,658 | 2,816 | |||||||
Marico, Ltd. (Personal products) | 223,870 | 1,150 | |||||||
Motherson Sumi Systems, Ltd. (Auto components) | 318,204 | 2,299 | |||||||
MRF, Ltd. (Auto components) | 3,450 | 2,066 | |||||||
Oberoi Realty, Ltd. (Real estate management & development) | 160,116 | 719 | |||||||
Page Industries, Ltd. (Textiles, apparel & luxury goods) | 4,203 | 777 | |||||||
Persistent Systems, Ltd. (IT services) | 60,469 | 1,589 | |||||||
Pidilite Industries, Ltd. (Chemicals) | 236,779 | 2,034 | |||||||
Prestige Estates Projects, Ltd. (Real estate management & development) | 186,109 | 702 | |||||||
Rallis India, Ltd. (Chemicals) | 267,555 | 910 | |||||||
Repco Home Finance, Ltd. (Consumer finance) | 129,623 | 1,361 | |||||||
Shree Cement, Ltd. (Construction materials) | 10,808 | 1,609 | |||||||
* | SKS Microfinance, Ltd. (Consumer finance) | 177,111 | 1,155 |
See accompanying Notes to Financial Statements.
96 | Annual Report | December 31, 2014 |
Emerging Markets Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
India—(continued) | |||||||||
Sobha Ltd. (Real estate management & development) | 60,547 | $ | 463 | ||||||
Supreme Industries, Ltd. (Chemicals) | 107,689 | 1,016 | |||||||
TVS Motor Co., Ltd. (Automobiles) | 198,448 | 840 | |||||||
VA Tech Wabag, Ltd. (Water utilities) | 43,026 | 995 | |||||||
Voltas, Ltd. (Construction & engineering) | 390,028 | 1,492 | |||||||
Yes Bank, Ltd. (Banks) | 397,848 | 4,828 | |||||||
69,154 | |||||||||
Indonesia—6.6% | |||||||||
PT Arwana Citramulia Tbk (Building products) | 3,500,800 | 245 | |||||||
PT Bank Negara Indonesia Persero Tbk (Banks) | 2,885,600 | 1,414 | |||||||
PT Ciputra Development Tbk (Real estate management & development) | 17,427,000 | 1,748 | |||||||
PT Jasa Marga (Transportation infrastructure) | 5,099,500 | 2,894 | |||||||
* | PT Link Net Tbk (Diversified telecommunication services) | 1,561,400 | 622 | ||||||
PT Matahari Department Store Tbk (Multiline retail) | 2,131,500 | 2,568 | |||||||
PT Pakuwon Jati Tbk (Real estate management & development) | 94,261,000 | 3,905 | |||||||
* | PT Siloam International Hospitals Tbk (Health care providers & services) | 594,900 | 658 | ||||||
PT Surya Citra Media Tbk (Media) | 4,421,000 | 1,247 | |||||||
PT Wijaya Karya Persero Tbk (Construction & engineering) | 5,196,700 | 1,534 | |||||||
16,835 | |||||||||
Malaysia—0.6% | |||||||||
Silverlake Axis, Ltd. (Software) | 1,460,000 | 1,378 | |||||||
Pakistan—2.2% | |||||||||
Lucky Cement, Ltd. (Construction materials) | 639,400 | 3,147 | |||||||
United Bank, Ltd. (Banks) | 1,379,000 | 2,394 | |||||||
5,541 | |||||||||
Philippines—5.4% | |||||||||
GT Capital Holdings, Inc. (Diversified financial services) | 102,645 | 2,351 | |||||||
Jollibee Foods Corporation (Hotels, restaurants & leisure) | 646,370 | 3,090 | |||||||
Megaworld Corporation (Real estate management & development) | 10,234,000 | 1,058 | |||||||
RFM Corporation (Food products) | 3,584,000 | 401 | |||||||
Robinsons Land Corporation (Real estate management & development) | 2,990,900 | 1,765 | |||||||
Security Bank Corporation (Banks) | 765,410 | 2,593 | |||||||
Universal Robina Corporation (Food products) | 546,840 | 2,384 | |||||||
13,642 |
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Asia—(continued) | |||||||||
South Korea—2.3% | |||||||||
* | CJ Korea Express Co., Ltd. (Road & rail) | 3,965 | $ | 700 | |||||
* | Cosmax, Inc. (Personal products) | 6,095 | 550 | ||||||
* | Dongwon F&B Co., Ltd. (Food products) | 2,685 | 713 | ||||||
Hana Tour Service, Inc. (Hotels, restaurants & leisure) | 2,661 | 188 | |||||||
* | Hanssem Co., Ltd. (Household durables) | 12,390 | 1,288 | ||||||
* | KEPCO Plant Service & Engineering Co., Ltd. (Commercial services & supplies) | 24,967 | 1,810 | ||||||
* | Korea Kolmar Co., Ltd. (Personal products) | 12,369 | 492 | ||||||
5,741 | |||||||||
Sri Lanka—0.5% | |||||||||
Commercial Bank of Ceylon plc (Banks) | 972,581 | 1,268 | |||||||
Taiwan—6.2% | |||||||||
E.Sun Financial Holding Co., Ltd. (Banks) | 4,509,000 | 2,794 | |||||||
Eclat Textile Co., Ltd. (Textiles, apparel & luxury goods) | 174,000 | 1,749 | |||||||
Feng TAY Enterprise Co., Ltd. (Textiles, apparel & luxury goods) | 34,000 | 103 | |||||||
Hermes Microvision, Inc. (Semiconductors & semiconductor equipment) | 75,000 | 3,751 | |||||||
King Slide Works Co., Ltd. (Machinery) | 90,000 | 1,147 | |||||||
Novatek Microelectronics Corporation (Semiconductors & semiconductor equipment) | 434,000 | 2,425 | |||||||
PChome Online, Inc. (Internet software & services) | 236,506 | 2,539 | |||||||
Poya Co., Ltd. (Multiline retail) | 157,090 | 1,185 | |||||||
15,693 | |||||||||
Thailand—5.5% | |||||||||
Central Plaza Hotel PCL (Hotels, restaurants & leisure) | 198,087 | 185 | |||||||
Chularat Hospital PCL Class “F” (Health care providers & services) | 1,244,900 | 678 | |||||||
Delta Electronics Thailand PCL (Electronic equipment, instruments & components) | 429,100 | 916 | |||||||
GFPT PCL (Food products) | 2,777,600 | 1,491 | |||||||
KCE Electronics PCL (Electronic equipment, instruments & components) | 1,271,800 | 1,314 | |||||||
LPN Development PCL (Real estate management & development) | 876,100 | 581 | |||||||
Minor International PCL (Hotels, restaurants & leisure) | 2,901,310 | 2,846 | |||||||
Sino-Thai Engineering & Construction PCL (Construction & engineering) | 1,623,300 | 1,140 | |||||||
Supalai PCL (Real estate management & development) | 2,054,000 | 1,494 | |||||||
Thai Union Frozen Products PCL (Food products) | 730,400 | 1,997 | |||||||
TTW PCL (Water utilities) | 4,015,800 | 1,413 | |||||||
14,055 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 97 |
Emerging Markets Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Shares | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Latin America—12.4% | |||||||||
Brazil—7.8% | |||||||||
Estacio Participacoes S.A. (Diversified consumer services) | 170,300 | $ | 1,548 | ||||||
GAEC Educacao S.A. (Diversified consumer services) | 148,000 | 1,959 | |||||||
* | Gol Linhas Aereas Inteligentes S.A.—ADR (Airlines) | 142,316 | 818 | ||||||
Iguatemi Empresa de Shopping Centers S.A. (Real estate management & development) | 40,300 | 372 | |||||||
Linx S.A. (Software) | 100,900 | 1,916 | |||||||
Localiza Rent a Car S.A. (Road & rail) | 10,600 | 143 | |||||||
Lojas Renner S.A. (Multiline retail) | 73,300 | 2,128 | |||||||
* | Qualicorp S.A. (Health care providers & services) | 241,700 | 2,534 | ||||||
Raia Drogasil S.A. (Food & staples retailing) | 351,800 | 3,387 | |||||||
Ser Educacional S.A. (Diversified consumer services) | 170,300 | 1,905 | |||||||
Smiles S.A. (Media) | 67,700 | 1,173 | |||||||
Valid Solucoes e Servicos de Seguranca em Meios de Pagamento e Identificacao S.A (Commercial services & supplies) | 111,300 | 1,778 | |||||||
19,661 | |||||||||
Mexico—4.6% | |||||||||
* | Banregio Grupo Financiero S.A.B. de C.V. (Banks) | 313,008 | 1,576 | ||||||
* | Compartamos S.A.B. de C.V. (Consumer finance) | 963,700 | 1,937 | ||||||
Corporation Inmobiliaria Vesta S.A.B. de C.V. (Real estate management & development) | 436,800 | 867 | |||||||
Credito Real S.A.B. de C.V. (Consumer finance) | 673,851 | 1,442 | |||||||
Gruma S.A.B. de C.V. Class “B” (Food products) | 80,100 | 857 | |||||||
* | Grupo Aeroportuario del Centro Norte S.A.B. de C.V. (Transportation infrastructure) | 211,400 | 968 | ||||||
Grupo Aeroportuario del Pacifico S.A.B. de C.V. Class “B” (Transportation infrastructure) | 305,700 | 1,915 | |||||||
* | Megacable Holdings S.A.B. de C.V. (Media) | 293,000 | 1,146 | ||||||
* | TF Administradora Industrial S de RL de C.V. (Real estate investment trusts (REITs)) | 498,300 | 1,045 | ||||||
11,753 | |||||||||
Emerging Europe, Mid-East, Africa—12.2% | |||||||||
Kenya—1.6% | |||||||||
Equity Bank, Ltd. (Banks) | 2,387,000 | 1,318 | |||||||
Kenya Commercial Bank, Ltd. (Banks) | 1,787,000 | 1,118 | |||||||
Safaricom, Ltd. (Wireless telecommunication services) | 11,001,200 | 1,712 | |||||||
4,148 |
Shares/ | |||||||||
Issuer | Contracts | Value | |||||||
Common Stocks—(continued) | |||||||||
Emerging Europe, Mid-East, Africa—(continued) | |||||||||
Qatar—1.2% | |||||||||
Al Meera Consumer Goods Co. (Food & staples retailing) | 23,965 | $ | 1,304 | ||||||
Qatar Insurance Co. (Insurance) | 38,750 | 957 | |||||||
Qatar International Islamic Bank (Banks) | 36,898 | 815 | |||||||
3,076 | |||||||||
South Africa—4.8% | |||||||||
AVI, Ltd. (Food products) | 283,818 | 1,902 | |||||||
Capitec Bank Holdings, Ltd. (Banks) | 46,286 | 1,355 | |||||||
Clicks Group, Ltd. (Food & staples retailing) | 136,720 | 956 | |||||||
Coronation Fund Managers, Ltd. (Capital markets) | 197,998 | 1,959 | |||||||
Mr Price Group, Ltd. (Specialty retail) | 143,840 | 2,910 | |||||||
Pioneer Foods, Ltd. (Food products) | 147,491 | 1,817 | |||||||
Rand Merchant Insurance Holdings, Ltd. (Insurance) | 354,917 | 1,251 | |||||||
12,150 | |||||||||
Turkey—2.9% | |||||||||
Arcelik A.S. (Household durables) | 198,296 | 1,270 | |||||||
Brisa Bridgestone Sabanci Sanayi ve Ticaret A.S. (Auto components) | 324,587 | 1,360 | |||||||
* | Pegasus Hava Tasimaciligi A.S. (Airlines) | 133,861 | 1,893 | ||||||
TAV Havalimanlari Holding A.S. (Transportation infrastructure) | 134,822 | 1,100 | |||||||
Tofas Turk Otomobil Fabrikasi A.S. (Automobiles) | 260,126 | 1,773 | |||||||
7,396 | |||||||||
United Arab Emirates—1.7% | |||||||||
Air Arabia PJSC (Airlines) | 3,619,623 | 1,457 | |||||||
Al Noor Hospitals Group plc (Health care providers & services) | 43,613 | 673 | |||||||
DAMAC Real Estate Development, Ltd.—144A-—GDR (Real estate management & development) | 54,873 | 746 | |||||||
National Bank of Ras Al-Khaimah (Banks) | 226,847 | 503 | |||||||
NMC Health plc (Health care providers & services) | 121,626 | 866 | |||||||
4,245 | |||||||||
Total Common Stocks—99.4% (cost $219,015) | 252,295 | ||||||||
Warrants | |||||||||
Emerging Asia—0.0% | |||||||||
Thailand—0.0% | |||||||||
* | Minor International PCL (Hotels,restaurants & leisure) | 4,031 | 1 | ||||||
Total Warrants—0.0% (cost $0) | 1 |
See accompanying Notes to Financial Statements.
98 | Annual Report | December 31, 2014 |
Emerging Markets Small Cap Growth Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Principal | |||||||||
Issuer | Amount | Value | |||||||
Repurchase Agreement | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $2,512, collateralized by Federal Home Loan Bank, 5.250%, due 6/12/37 | $2,512 | $ | 2,512 | ||||||
Total Repurchase Agreement—1.0% (cost $2,512) | 2,512 | ||||||||
Total Investments—100.4% (cost $221,527) | 254,808 | ||||||||
Liabilities, plus cash and other assets—(0.4)% | (905 | ) | |||||||
Net assets—100.0% | $ | 253,903 |
ADR = American Depository Receipt
GDR = Global Depository Receipt
* Non-income producing securities † = U.S. listed foreign security
For securities primarily traded on exchanges or markets that close before the close of regular trading on the New York Stock Exchange, the Fund may use an independent pricing service to fair value price the securities pursuant to Valuation Procedures approved by the Board of Trustees.
At December 31, 2014, the Fund’s Portfolio of Investments includes the following industry categories (as a percentage of long-term investments):
Financials | 24.9 | % | ||
Consumer Discretionary | 19.1 | % | ||
Industrials | 17.0 | % | ||
Information Technology | 10.9 | % | ||
Consumer Staples | 9.9 | % | ||
Health Care | 8.7 | % | ||
Materials | 4.3 | % | ||
Utilities | 3.7 | % | ||
Telecommunication Services | 1.5 | % | ||
Total | 100.0 | % |
At December 31, 2014, the Fund’s Portfolio of Investments includes the following currency categories (as a percentage of long-term investments):
Indian Rupee | 27.4 | % | ||
Hong Kong Dollar | 13.9 | % | ||
Brazilian Real | 7.5 | % | ||
Indonesian Rupiah | 6.7 | % | ||
New Taiwan Dollar | 6.2 | % | ||
Thai Baht | 5.6 | % | ||
Philippine Peso | 5.4 | % | ||
U.S. Dollar | 5.2 | % | ||
South African Rand | 4.8 | % | ||
Mexican Peso | 4.7 | % | ||
Turkish Lira | 2.9 | % | ||
South Korean Won | 2.3 | % | ||
Pakistan Rupee | 2.2 | % | ||
Kenyan Shilling | 1.6 | % | ||
Qatari Rial | 1.2 | % | ||
All Other Currencies | 2.4 | % | ||
Total | 100.0 | % |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 99 |
FIXED INCOME MARKET REVIEW AND OUTLOOK
2014 was a year of divergence, and the effects of the divergence were on display during the fourth quarter. U.S. economic performance continued to improve, while performance in the Eurozone and certain emerging markets faltered. Market performance reflected this divergence; U.S. stocks and bonds posted gains, while developed and emerging market equity markets posted declines.
The U.S. economy showed several signs of improvement during 2014. The labor market strengthened as the economy added jobs and the unemployment rate fell, and real gross domestic product grew at higher levels than many other developed market countries. Meanwhile, inflationary pressures have been benign and weakening, perhaps to the point of some concern. Due to a confluence of factors, including plummeting oil prices during the fourth quarter, inflation appears poised to finish the year below the Federal Reserve’s (the “Fed”) 2% minimum objective, and forward-looking expectations are below the Fed’s target range as well.
With the backdrop of a growing economy and benign inflation, the Fed tapered its large-scale asset purchase program, quantitative easing, to zero new purchases during 2014. The Fed’s policy rate, the fed funds rate, remains at a range of 0.00% - 0.25%, and the policy question turns to when the Fed will exit its zero interest rate policy that has been in place since the end of 2008. We believe the Fed will balance its dual objectives of maximum employment and price stability when deciding whether to change its policy rate, and the Fed’s attention will turn to its price stability objective if inflationary pressures remain weak.
The non-U.S. markets faced myriad different issues during 2014. Eurozone growth weakened and disinflationary pressures took hold, and European policymakers are facing another round of potential policy coordination to address the situation. Japan remains committed to spurring economic activity through unconventional monetary policy actions. The collapse in oil prices during the fourth quarter impacted several oil-intensive economies. International sanctions against Russia and a collapse of the ruble contributed to deteriorating economic conditions in Russia. Economies with strong ties to Russia also faltered. The Brazilian government launched an investigation into fraud at its large, state-owned, oil and gas company, Petrobras.
The U.S. bond market experienced strong performance during 2014 on the heels of declining longer-term interest rates. The strongest-performing segments of the market were mortgage-backed securities and fixed-rate Treasuries. Corporate bonds underperformed the broad market after controlling for duration. Treasury Inflation-Protected Securities trailed the broad market as inflation expectations declined throughout the back half of the year. High-yield corporate bonds underperformed investment-grade corporate bonds.
Looking forward, we believe that the Federal Open Market Committee (“FOMC”) will balance the Fed’s dual objectives of maximum employment and price stability when they decide whether to raise the federal funds rate. Growth and employment in the U.S. has improved; GDP stands to grow by 2.0%-2.5% in real terms in 2014, and the unemployment rate has declined to 5.8%. Inflationary pressures decreased during the latter half of 2014. Commodity prices weakened, price indexes such as the Consumer Price Index and Personal Consumption Expenditures Index showed that inflation is below the FOMC’s stated target range of 2.0%-2.5%, and forward-looking, market-implied inflation expectations decreased below the target range. We believe that the FOMC will pay careful attention to its price stability objective when they decide whether to raise the federal funds rate to ensure that doing so will not spur deflationary pressures.
We believe that the threat of a sustained, rapid rise in interest rates is subdued, though longer-term interest rates may tread higher. While many worried that rates would rise after the FOMC’s bond-buying program tapered to zero, there are reasons to think that other buyers may emerge. Inflation in the Eurozone is low, and the European Central Bank may consider another round of large-scale asset purchases. In addition, longer-term U.S. Treasury rates are higher and attractive relative to government bond yields around the world.
With corporations holding record levels of cash, the corporate bond market remains concerned about shareholder-friendly activities such as leveraged buyouts (“LBOs”), large share repurchases, and special dividends. We believe idiosyncratic risks are among the top issues for investment-grade corporate bond investors, but we do not believe the market will enter a period of excessive LBO activity.
We also believe that spread sectors are poised to lead the market. Corporate risk premiums are at levels below their longer-term averages but not approaching the historically cheap levels experienced in prior years. In addition, fundamentals are strong, as corporations’ balance sheets are strong given their historically high level of cash holdings. For these reasons, coupled with the low level of Treasury interest rates, we are bullish on spread products relative to Treasuries.
100 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 101 |
Bond Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | Since Inception(a) | |||||||||||||
Class N | 5.10 | % | 3.94 | % | 5.41 | % | 5.60 | % | ||||||||
Class I | 5.37 | 4.13 | 5.57 | 5.77 | ||||||||||||
Institutional Class | 5.53 | 4.26 | 5.73 | 5.93 | ||||||||||||
Barclays U.S. Aggregate Bond Index | 5.97 | 2.66 | 4.45 | 4.99 |
(a) | For the period from May 1, 2007 (Commencement of Operations) to December 31. 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) fees. Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Barclays U.S. Aggregate Bond Index indicates broad intermediate government/corporate bond market performance.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all investments in the Fund performed the same, nor is there any guarantee that these investments will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total investments.
102 | Annual Report | December 31, 2014 |
Bond Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Principal Amount | Value | |||||||
U.S. Government and U.S. Government Agency—46.3% | |||||||||
U.S. Treasury Inflation Indexed Notes/Bonds—6.2% | |||||||||
U.S. Treasury Inflation Indexed Note, 1.875%, due 7/15/19 | $ | 1,112 | $ | 1,195 | |||||
U.S. Treasury Inflation Indexed Bond, 3.875%, due 4/15/29 | 10,472 | 15,013 | |||||||
Total U.S. Treasury Inflation Indexed Notes/Bonds | 16,208 | ||||||||
U.S. Treasury-0.5% | |||||||||
U.S. Treasury Strip Principal, 0.000%, due 5/15/20 | 1,500 | 1,366 | |||||||
Government National Mortgage Association (GNMA)—1.2% | |||||||||
# | 623162, 6.500%, due 7/15/18 | 26 | 27 | ||||||
# | 589335, 6.500%, due 10/15/22 | 33 | 38 | ||||||
# | 357322, 7.000%, due 9/15/23 | 12 | 13 | ||||||
# | 616250, 6.000%, due 2/15/24 | 4 | 4 | ||||||
# | 509405, 7.500%, due 8/15/29 | 1 | 1 | ||||||
GNR 2004-2 M5, 4.891%, due 7/16/34 | 36 | 37 | |||||||
# | 699118, 6.000%, due 9/15/38 | 2,586 | 2,954 | ||||||
Total GNMA Mortgage Obligations | 3,074 | ||||||||
Federal Home Loan Mortgage Corp. (FHLMC)—5.6% | |||||||||
# | G12258, 6.000%, due 8/1/16 | 5 | 5 | ||||||
# | J04096, 6.500%, due 1/1/17 | 12 | 12 | ||||||
# | E90398, 7.000%, due 5/1/17 | 23 | 24 | ||||||
# | G11549, 7.000%, due 7/1/17 | 2 | 2 | ||||||
# | G90027, 6.000%, due 11/17/17 | 6 | 6 | ||||||
# | G30093, 7.000%, due 12/1/17 | 7 | 8 | ||||||
# | O20005, 6.500%, due 1/1/18 | 7 | 8 | ||||||
# | E96940, 4.500%, due 6/1/18 | 34 | 36 | ||||||
# | G30254, 6.500%, due 5/1/19 | 8 | 10 | ||||||
# | J02986, 6.500%, due 7/1/21 | 22 | 24 | ||||||
# | G30255, 7.000%, due 7/1/21 | 7 | 8 | ||||||
# | G30243, 6.000%, due 12/1/21 | 7 | 8 | ||||||
# | D95621, 6.500%, due 7/1/22 | 35 | 40 | ||||||
# | J16051, 4.500%, due 7/1/26 | 997 | 1,077 | ||||||
# | G02183, 6.500%, due 3/1/30 | 39 | 44 | ||||||
# | G01728, 7.500%, due 7/1/32 | 158 | 187 | ||||||
# | C01385, 6.500%, due 8/1/32 | 138 | 157 | ||||||
# | A13303, 5.000%, due 9/1/33 | 600 | 668 | ||||||
# | C01623, 5.500%, due 9/1/33 | 179 | 201 | ||||||
# | A15039, 5.500%, due 10/1/33 | 3 | 3 | ||||||
# | G01705, 5.500%, due 6/1/34 | 1,175 | 1,328 | ||||||
# | G01843, 6.000%, due 6/1/35 | 32 | 37 | ||||||
# | G02141, 6.000%, due 3/1/36 | 824 | 944 | ||||||
# | A62179, 6.000%, due 6/1/37 | 356 | 406 | ||||||
# | A63539, 6.000%, due 7/1/37 | 455 | 516 | ||||||
# | A62858, 6.500%, due 7/1/37 | 219 | 259 | ||||||
# | G03170, 6.500%, due 8/1/37 | 471 | 537 | ||||||
# | A66843, 6.500%, due 10/1/37 | 1,301 | 1,506 | ||||||
# | G04053, 5.500%, due 3/1/38 | 115 | 131 | ||||||
# | A78138, 5.500%, due 6/1/38 | 576 | 657 | ||||||
# | G04466, 5.500%, due 7/1/38 | 296 | 337 | ||||||
# | G04544, 6.000%, due 8/1/38 | 1,205 | 1,368 |
Issuer | Principal Amount | Value | |||||||
U.S. Government and U.S. Government Agency—(continued) | |||||||||
Federal Home Loan Mortgage Corp. (FHLMC)—(continued) | |||||||||
# | A81799, 6.500%, due 9/1/38 | $ | 999 | $ | 1,189 | ||||
# | A86143, 5.000%, due 5/1/39 | 73 | 82 | ||||||
# | G06017, 5.500%, due 6/1/40 | 270 | 308 | ||||||
# | C03665, 9.000%, due 4/1/41 | 1,083 | 1,257 | ||||||
# | G06583, 5.000%, due 6/1/41 | 1,291 | 1,454 | ||||||
Total FHLMC Mortgage Obligations | 14,844 | ||||||||
Federal National Mortgage Association (FNMA)—32.8% | |||||||||
# | 576553, 8.000%, due 2/1/16 | 8 | 8 | ||||||
# | 679247, 7.000%, due 8/1/17 | 4 | 4 | ||||||
# | 689612, 5.000%, due 5/1/18 | 85 | 90 | ||||||
# | 695910, 5.000%, due 5/1/18 | 201 | 212 | ||||||
# | 697593, 5.000%, due 5/1/18 | 177 | 187 | ||||||
# | 251960, 6.000%, due 9/1/18 | 3 | 3 | ||||||
# | 770395, 5.000%, due 4/1/19 | 5 | 5 | ||||||
# | 788424, 5.500%, due 9/1/19 | 27 | 29 | ||||||
# | 835563, 7.000%, due 10/1/20 | 21 | 23 | ||||||
# | 900725, 6.000%, due 8/1/21 | 55 | 60 | ||||||
# | 893325, 7.000%, due 9/1/21 | 22 | 24 | ||||||
# | 735104, 7.000%, due 5/1/22 | 5 | 5 | ||||||
# | 889342, 5.000%, due 3/1/23 | 80 | 86 | ||||||
# | AA2924, 4.500%, due 4/1/24 | 385 | 416 | ||||||
# | AC1848, 4.500%, due 9/1/24 | 513 | 555 | ||||||
# | 932095, 4.000%, due 11/1/24 | 1,939 | 2,089 | ||||||
# | AB1459, 4.000%, due 9/1/25 | 382 | 412 | ||||||
# | 255956, 5.500%, due 10/1/25 | 28 | 31 | ||||||
# | AH2671, 4.000%, due 1/1/26 | 1,558 | 1,680 | ||||||
# | AI4872, 4.500%, due 6/1/26 | 546 | 591 | ||||||
# | AL2851, 4.000%, due 8/1/26 | 5,591 | 6,024 | ||||||
# | AI9811, 4.500%, due 8/1/26 | 334 | 361 | ||||||
# | AJ3203, 4.000%, due 10/1/26 | 141 | 152 | ||||||
# | AJ7724, 4.000%, due 12/1/26 | 1,139 | 1,228 | ||||||
# | AJ9402, 4.000%, due 12/1/26 | 1,499 | 1,615 | ||||||
# | AK7384, 4.000%, due 3/1/27 | 1,318 | 1,421 | ||||||
# | AB4818, 4.000%, due 4/1/27 | 888 | 957 | ||||||
# | AL2590, 4.000%, due 7/1/27 | 3,884 | 4,188 | ||||||
# | AV6413, 4.000%, due 2/1/29 | 2,626 | 2,830 | ||||||
# | 252925, 7.500%, due 12/1/29 | 2 | 2 | ||||||
# | 535977, 6.500%, due 4/1/31 | 12 | 14 | ||||||
# | 253907, 7.000%, due 7/1/31 | 2 | 2 | ||||||
# | 587849, 6.500%, due 11/1/31 | 19 | 23 | ||||||
# | 545437, 7.000%, due 2/1/32 | 77 | 89 | ||||||
# | 545759, 6.500%, due 7/1/32 | 714 | 826 | ||||||
# | 545869, 6.500%, due 7/1/32 | 2,113 | 2,408 | ||||||
# | 678007, 6.000%, due 9/1/32 | 11 | 12 | ||||||
# | 670385, 6.500%, due 9/1/32 | 1,091 | 1,270 | ||||||
# | 254548, 5.500%, due 12/1/32 | 80 | 90 | ||||||
# | 684601, 6.000%, due 3/1/33 | 787 | 909 | ||||||
# | 703391, 5.000%, due 5/1/33 | 106 | 119 | ||||||
# | 708993, 5.000%, due 6/1/33 | 40 | 45 | ||||||
# | 730131, 5.000%, due 8/1/33 | 69 | 77 | ||||||
# | 727056, 5.000%, due 9/1/33 | 520 | 584 | ||||||
# | 741850, 5.500%, due 9/1/33 | 909 | 1,032 | ||||||
# | 739243, 6.000%, due 9/1/33 | 1,005 | 1,161 | ||||||
# | 739331, 6.000%, due 9/1/33 | 494 | 570 | ||||||
# | 555800, 5.500%, due 10/1/33 | 90 | 101 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 103 |
Bond Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Principal Amount | Value | |||||||
U.S. Government and U.S. Government Agency—(continued) | |||||||||
Federal National Mortgage Association (FNMA)—(continued) | |||||||||
# | 555946, 5.500%, due 11/1/33 | $ | 441 | $ | 502 | ||||
# | 756153, 5.500%, due 11/1/33 | 923 | 1,047 | ||||||
# | 725017, 5.500%, due 12/1/33 | 74 | 85 | ||||||
# | 763798, 5.500%, due 3/1/34 | 134 | 152 | ||||||
# | 776964, 5.000%, due 4/1/34 | 361 | 405 | ||||||
# | 725611, 5.500%, due 6/1/34 | 162 | 182 | ||||||
# | 783786, 5.500%, due 7/1/34 | 154 | 175 | ||||||
# | 786546, 6.000%, due 7/1/34 | 382 | 439 | ||||||
# | 787816, 6.000%, due 7/1/34 | 487 | 563 | ||||||
# | 745563, 5.500%, due 8/1/34 | 820 | 931 | ||||||
# | 794474, 6.000%, due 10/1/34 | 65 | 74 | ||||||
# | 745092, 6.500%, due 7/1/35 | 540 | 626 | ||||||
# | 357944, 6.000%, due 9/1/35 | 36 | 41 | ||||||
# | 829306, 6.000%, due 9/1/35 | 415 | 478 | ||||||
# | 836140, 5.500%, due 10/1/35 | 75 | 86 | ||||||
# | 843487, 6.000%, due 10/1/35 | 150 | 173 | ||||||
# | 849191, 6.000%, due 1/1/36 | 226 | 260 | ||||||
# | 745349, 6.500%, due 2/1/36 | 499 | 592 | ||||||
# | 888305, 7.000%, due 3/1/36 | 15 | 17 | ||||||
# | 895637, 6.500%, due 5/1/36 | 146 | 167 | ||||||
# | 831540, 6.000%, due 6/1/36 | 54 | 62 | ||||||
# | 745802, 6.000%, due 7/1/36 | 250 | 289 | ||||||
# | 886220, 6.000%, due 7/1/36 | 495 | 572 | ||||||
# | AL3449, 6.000%, due 7/1/36 | 2,107 | 2,435 | ||||||
# | 893318, 6.500%, due 8/1/36 | 57 | 65 | ||||||
# | 831926, 6.000%, due 12/1/36 | 15 | 17 | ||||||
# | 902974, 6.000%, due 12/1/36 | 400 | 460 | ||||||
# | 909480, 6.000%, due 2/1/37 | 428 | 492 | ||||||
# | 888418, 5.500%, due 5/1/37 | 652 | 742 | ||||||
# | 938440, 6.000%, due 7/1/37 | 179 | 204 | ||||||
# | 928561, 6.000%, due 8/1/37 | 326 | 377 | ||||||
# | 948689, 6.000%, due 8/1/37 | 324 | 367 | ||||||
# | 888703, 6.500%, due 8/1/37 | 6,517 | 7,689 | ||||||
# | 946646, 6.000%, due 9/1/37 | 116 | 132 | ||||||
# | 888967, 6.000%, due 12/1/37 | 1,128 | 1,302 | ||||||
# | 889385, 6.000%, due 2/1/38 | 275 | 314 | ||||||
# | 962058, 6.500%, due 3/1/38 | 2,073 | 2,473 | ||||||
# | 934006, 6.500%, due 9/1/38 | 603 | 710 | ||||||
# | 986856, 6.500%, due 9/1/38 | 323 | 381 | ||||||
# | 991911, 7.000%, due 11/1/38 | 350 | 398 | ||||||
# | AL3775, 5.000%, due 1/1/39 | 2,338 | 2,624 | ||||||
# | AA7611, 5.000%, due 5/1/39 | 1,175 | 1,324 | ||||||
# | AA8443, 5.000%, due 6/1/39 | 331 | 373 | ||||||
# | 931492, 6.000%, due 7/1/39 | 267 | 309 | ||||||
# | AA6898, 6.000%, due 7/1/39 | 973 | 1,103 | ||||||
# | 931801, 5.000%, due 8/1/39 | 1,252 | 1,404 | ||||||
# | 932279, 5.000%, due 12/1/39 | 140 | 157 | ||||||
# | AC9569, 5.000%, due 2/1/40 | 1,939 | 2,188 | ||||||
# | AE0082, 5.000%, due 5/1/40 | 754 | 844 | ||||||
# | AD7531, 5.500%, due 6/1/40 | 307 | 351 | ||||||
# | AB1200, 5.500%, due 7/1/40 | 1,885 | 2,151 | ||||||
# | AD7137, 5.500%, due 7/1/40 | 3,350 | 3,831 | ||||||
# | AL0028, 5.000%, due 2/1/41 | 3,551 | 3,980 | ||||||
# | AL0913, 6.000%, due 7/1/41 | 1,619 | 1,864 | ||||||
# | AK2733, 5.000%, due 2/1/42 | 2,621 | 2,958 | ||||||
Total FNMA Mortgage Obligations | 86,557 |
Issuer | NRSRO Rating (unaudited) | Principal Amount | Value | ||||||||
Asset-Backed Securities—5.2% | |||||||||||
Avis Budget Rental Car Funding AESOP LLC—144A, 2010-3A, Tranche A, 4.640%, 5/20/16 | Aaa | $ | 2,883 | $ | 2,908 | ||||||
Centre Point Funding LLC—144A, 2010-1A, Tranche 1, 5.430%, 7/20/16 | A2 | 919 | 932 | ||||||||
Hertz Vehicle Financing LLC—144A, 2013-1A, Tranche B1, 1.860%, 8/25/17 | Baa1 | 1,650 | 1,655 | ||||||||
GE Capital Credit Card Master Note Trust, 2012-6, Tranche B, 1.830%, 8/17/20 | AA+ | 3,000 | 3,006 | ||||||||
SLM Student Loan Trust, 2002-1, Tranche B, 0.704%, 1/25/21, VRN | AAA | 1,201 | 1,197 | ||||||||
Centre Point Funding LLC—144A, 2012-2A, Tranche 1, 2.610%, 8/20/21 | Baa2 | 1,774 | 1,762 | ||||||||
SLM Private Education Loan Trust—144A, 2011-A, Tranche A3, 2.661%, 1/15/43, VRN | AAA | 2,000 | 2,130 | ||||||||
Total Asset-Backed Securities | 13,590 | ||||||||||
Corporate Obligations—45.5% | |||||||||||
Penske Truck Leasing Co. L.P.—144A, 3.750%, due 5/11/17 | BBB+ | 2,000 | 2,091 | ||||||||
Toll Brothers Finance Corporation, 8.910%, due 10/15/17 | BBB- | 1,050 | 1,223 | ||||||||
Intesa Sanpaolo SpA, 3.875%, due 1/16/18 | BBB+ | 2,000 | 2,084 | ||||||||
Banco Davivienda S.A.—144A, 2.950%, due 1/29/18 | BBB- | 2,000 | 1,966 | ||||||||
Morgan Stanley, 6.625%, due 4/1/18 | A | 2,000 | 2,280 | ||||||||
Bank of America Corporation, 6.875%, due 11/15/18 | A | 1,100 | 1,280 | ||||||||
Glencore Funding LLC—144A, 1.591%, due 1/15/19, VRN | BBB | 1,500 | 1,527 | ||||||||
Petrobras Global Finance BV, 2.371%, due 1/15/19, VRN | Baa2 | 2,900 | 2,580 | ||||||||
CSX Corporation, 7.375%, due 2/1/19 | BBB+ | 870 | 1,043 | ||||||||
Cemex S.A.B. de C.V.—144A, 5.875%, due 3/25/19 | BB- | 1,500 | 1,526 | ||||||||
Citigroup, Inc., 8.500%, due 5/22/19 | A | 2,050 | 2,557 | ||||||||
Baidu, Inc., 2.750%, due 6/9/19 | A | 1,707 | 1,703 | ||||||||
Roper Industries, Inc., 6.250%, due 9/1/19 | BBB | 1,850 | 2,134 | ||||||||
Republic Services, Inc., 5.500%, due 9/15/19 | BBB+ | 1,725 | 1,945 | ||||||||
SBA Communications Corporation, 5.625%, due 10/1/19 | B | 1,250 | 1,284 | ||||||||
Geely Automobile Holdings Ltd.—144A, 5.250%, due 10/6/19 | BB+ | 1,000 | 973 | ||||||||
Boston Properties L.P., 5.875%, due 10/15/19 | A- | 1,575 | 1,806 |
See accompanying Notes to Financial Statements.
104 | Annual Report | December 31, 2014 |
Bond Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | NRSRO Rating (unaudited) | Principal Amount | Value | ||||||||
Corporate Obligations—(continued) | |||||||||||
Toll Brothers Finance Corporation, 6.750%, due 11/1/19 | BBB- | $ | 500 | $ | 563 | ||||||
Ford Motor Credit Co. LLC, 8.125%, due 1/15/20 | BBB- | 2,500 | 3,100 | ||||||||
Johnson Controls, Inc., 5.000%, due 3/30/20 | BBB+ | 1,675 | 1,840 | ||||||||
Ally Financial, Inc., 7.500%, due 9/15/20 | BB+ | 799 | 939 | ||||||||
Georgia-Pacific LLC—144A, 5.400%, due 11/1/20 | A+ | 2,400 | 2,704 | ||||||||
Standard Pacific Corporation, 8.375%, due 1/15/21 | B+ | 1,750 | 1,991 | ||||||||
ArcelorMittal, 6.000%, due 3/1/21 | BB+ | 1,600 | 1,670 | ||||||||
JBS USA LLC / JBS USA Finance, Inc.—144A, 7.250%, due 6/1/21 | BB | 1,500 | 1,552 | ||||||||
O’Reilly Automotive, Inc., 4.625%, due 9/15/21 | BBB | 2,500 | 2,730 | ||||||||
Corporation Nacional del Cobre de Chile—144A, 3.875%, due 11/3/21 | AA- | 1,900 | 1,957 | ||||||||
Itau Unibanco Holding S.A.—144A, 6.200%, due 12/21/21 | BBB | 1,600 | 1,687 | ||||||||
Fresenius Medical Care US Finance II, Inc.—144A, 5.875%, due 1/31/22 | BB+ | 1,000 | 1,090 | ||||||||
Masco Corporation, 5.950%, due 3/15/22 | BBB | 2,475 | 2,760 | ||||||||
The Kroger Co., 3.400%, due 4/15/22 | BBB | 2,500 | 2,549 | ||||||||
United Rentals North America, Inc., 7.625%, due 4/15/22 | BB- | 1,525 | 1,684 | ||||||||
Discover Financial Services, 5.200%, due 4/27/22 | BBB+ | 2,150 | 2,378 | ||||||||
The Goodyear Tire & Rubber Co., 7.000%, due 5/15/22 | B+ | 2,000 | 2,170 | ||||||||
American International Group, Inc., 4.875%, due 6/1/22 | A- | 1,000 | 1,125 | ||||||||
Triumph Group, Inc., 5.250%, due 6/1/22 | BB- | 1,750 | 1,754 | ||||||||
Embraer S.A., 5.150%, due 6/15/22 | BBB | 2,500 | 2,644 | ||||||||
Bancolombia S.A., 5.125%, due 9/11/22 | BBB- | 1,750 | 1,743 | ||||||||
Penske Automotive Group, Inc., 5.750%, due 10/1/22 | B+ | 1,500 | 1,564 | ||||||||
American Axle & Manufacturing, Inc., 6.625%, due 10/15/22 | BB- | 1,550 | 1,651 | ||||||||
Jones Lang LaSalle, Inc., 4.400%, due 11/15/22 | BBB | 1,750 | 1,819 | ||||||||
Owens Corning, 4.200%, due 12/15/22 | BBB- | 500 | 508 | ||||||||
Jaguar Land Rover Automotive plc—144A, 5.625%, due 2/1/23 | BB | 1,500 | 1,584 | ||||||||
Wyndham Worldwide Corporation, 3.900%, due 3/1/23 | BBB- | 2,000 | 1,977 | ||||||||
Avis Budget Car Rental LLC, 5.500%, due 4/1/23 | BB- | 1,525 | 1,563 |
Issuer | NRSRO Rating (unaudited) | Principal Amount | Value | ||||||||
Corporate Obligations—(continued) | |||||||||||
Toll Brothers Finance Corporation, 4.375%, due 4/15/23 | BBB- | $ | 1,300 | $ | 1,280 | ||||||
Fibria Overseas Finance, Ltd., 5.250%, due 5/12/24 | BBB- | 2,500 | 2,490 | ||||||||
BRF S.A.—144A, 4.750%, due 5/22/24 | BBB- | 2,000 | 1,947 | ||||||||
Banco Inbursa S.A. Institucion de Banca Multiple—144A, 4.125%, due 6/6/24 | BBB+ | 2,000 | 1,965 | ||||||||
Grupo Bimbo S.A.B. de C.V.—144A, 3.875%, due 6/27/24 | BBB | 2,000 | 2,013 | ||||||||
Synchrony Financial, 4.250%, due 8/15/24 | BBB- | 1,900 | 1,952 | ||||||||
Nordea Bank AB—144A, 6.125%, due 9/23/24, VRN | BBB | 300 | 298 | ||||||||
Credit Suisse Group AG—144A, 6.250%, due 12/18/24, VRN | BB+ | 1,000 | 965 | ||||||||
The Kroger Co., 8.000%, due 9/15/29 | BBB | 450 | 622 | ||||||||
Comcast Corporation, 6.450%, due 3/15/37 | A- | 650 | 868 | ||||||||
DP World Ltd.—144A, 6.850%, due 7/2/37 | Baa3 | 2,000 | 2,266 | ||||||||
JPMorgan Chase & Co., 6.400%, due 5/15/38 | A+ | 1,470 | 1,927 | ||||||||
Philip Morris International, Inc., 6.375%, due 5/16/38 | A | 2,175 | 2,790 | ||||||||
General Electric Capital Corporation, 6.875%, due 1/10/39 | AA+ | 750 | 1,065 | ||||||||
Burlington Northern Santa Fe LLC, 5.750%, due 5/1/40 | A3 | 1,565 | 1,938 | ||||||||
Petroleos Mexicanos, 6.500%, due 6/2/41 | A3 | 1,925 | 2,219 | ||||||||
Express Scripts Holding Co., 6.125%, due 11/15/41 | BBB+ | 2,500 | 3,161 | ||||||||
Gilead Sciences, Inc., 5.650%, due 12/1/41 | A- | 1,775 | 2,206 | ||||||||
Bank of America Corporation, 5.875%, due 2/7/42 | A | 2,375 | 2,983 | ||||||||
Odebrecht Finance Ltd.—144A, 7.125%, due 6/26/42 | BBB | 2,000 | 1,685 | ||||||||
Mexichem S.A.B. de C.V.—144A, 5.875%, due 9/17/44 | BBB | 2,000 | 1,910 | ||||||||
Total Corporate Obligations | 119,848 | ||||||||||
Total Long-Term Investments—97.0% (cost $246,345) | $ | 255,487 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 105 |
Bond Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Issuer | Principal Amounts/ Contracts | Value | |||||||
Repurchase Agreements | |||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $5,684, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | $ | 5,684 | $ | 5,684 | |||||
Total Repurchase Agreement—2.1% (cost $5,684) | 5,684 | ||||||||
U.S. Government and U.S. Government Agency | |||||||||
U.S. Treasury Bill, 0.007%, due 7/23/15(a) | 500 | 500 | |||||||
Total U.S. Government and U.S. Government Agency—0.2% (cost $500) | 500 | ||||||||
Purchased Options | |||||||||
Eurodollar Future, September 2015, Strike $98, Put | 300 | 2 | |||||||
Eurodollar Future, September 2016, Strike $97, Put | 300 | 71 | |||||||
Total Purchased Options—0.0% (premiums paid $215) | 73 | ||||||||
Total Investments—99.3% (cost $252,744) | 261,744 | ||||||||
Cash and other assets, less liabilities—0.7% | 1,783 | ||||||||
Net assets—100.0% | $ | 263,527 |
(a) Security, or portion of security, is segregated as collateral for the credit default swap aggregating a total value of $202 (in thousands).
NRSRO = Nationally Recognized Statistical Rating Organization—The credit quality ratings of the securities in the Fund reflect the highest category rating by either Fitch Ratings, Moody’s Investors Service Inc., or Standard & Poor’s, a division of the McGraw-Hill Companies, Inc.
The obligations of certain U. S. Government-sponsored securities are neither issued nor guaranteed by the U. S. Treasury.
VRN = Variable Rate Note
Centrally Cleared Credit Default Swap
Reference Entity | Buy/Sell Protection | Fixed Deal Pay Rate | Maturity Date | Cleared Exchange | Notional Amount | Unrealized Appreciation (Depreciation) | ||||||
CDX.IG-23 | Buy | 1.00% | Dec 2019 | CME | $15,000 | $(17) |
See accompanying Notes to Financial Statements.
106 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 107 |
Income Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | 3.06 | % | 2.44 | % | 3.70 | % | 3.26 | % | ||||||||
Class I | 3.20 | 2.65 | 3.93 | 3.45 | ||||||||||||
Barclays Intermediate Government/Credit Bond Index | 3.13 | 2.03 | 3.54 | 4.10 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Barclays Intermediate Government/Credit Bond Index indicates broad intermediate government/corporate bond market performance.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all investments in the Fund performed the same, nor is there any guarantee that these investments will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total investments.
108 | Annual Report | December 31, 2014 |
Income Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Principal | |||||||||
Issuer | Amount | Value | |||||||
U.S. Government and U.S. Government Agency—55.6% | |||||||||
U.S. Treasury Inflation Indexed Notes/Bonds—5.1% | |||||||||
U.S. Treasury Inflation Indexed Note, 1.875%, due 7/15/19 | $1,112 | $ | 1,195 | ||||||
U.S. Treasury Inflation Indexed Note, 1.125%, due 1/15/21 | 3,691 | 3,838 | |||||||
Total U.S. Treasury Inflation Indexed Notes/Bonds | 5,033 | ||||||||
U.S. Treasury—0.9% | |||||||||
U.S. Treasury Strip Principal, 0.000%, due 5/15/20 | 1,000 | 911 | |||||||
Government National Mortgage Association (GNMA)—0.1% | |||||||||
# | 780405, 9.500%, due 11/15/17 | 26 | 27 | ||||||
# | 357322, 7.000%, due 9/15/23 | 43 | 47 | ||||||
Total GNMA Mortgage Obligations | 74 | ||||||||
Federal Home Loan Mortgage Corp. (FHLMC)—9.5% | |||||||||
# | E81697, 8.000%, due 5/1/15 | 23 | 23 | ||||||
# | E81908, 8.500%, due 12/1/15 | 5 | 5 | ||||||
# | J02184, 8.000%, due 4/1/16 | 3 | 3 | ||||||
# | G90022, 8.000%, due 9/17/16 | 3 | 3 | ||||||
# | M30028, 5.500%, due 5/1/17 | 1 | 1 | ||||||
# | E90398, 7.000%, due 5/1/17 | 156 | 164 | ||||||
# | E97112, 4.000%, due 5/1/18 | 63 | 67 | ||||||
# | D95621, 6.500%, due 7/1/22 | 923 | 1,049 | ||||||
# | J16051, 4.500%, due 7/1/26 | 1,439 | 1,556 | ||||||
# | A45790, 7.500%, due 5/1/35 | 154 | 179 | ||||||
# | G02141, 6.000%, due 3/1/36 | 413 | 472 | ||||||
# | A66843, 6.500%, due 10/1/37 | 471 | 546 | ||||||
# | A81799, 6.500%, due 9/1/38 | 560 | 666 | ||||||
# | G06964, 5.500%, due 11/1/38 | 1,552 | 1,753 | ||||||
# | C03665, 9.000%, due 4/1/41 | 525 | 609 | ||||||
# | G06583, 5.000%, due 6/1/41 | 2,065 | 2,327 | ||||||
Total FHLMC Mortgage Obligations | 9,423 | ||||||||
Federal National Mortgage Association (FNMA)—40.0% | |||||||||
# | 576554, 8.000%, due 1/1/16 | 81 | 83 | ||||||
# | 576553, 8.000%, due 2/1/16 | 122 | 125 | ||||||
# | 555747, 8.000%, due 5/1/16 | 3 | 3 | ||||||
# | 735569, 8.000%, due 10/1/16 | 40 | 41 | ||||||
# | 725410, 7.500%, due 4/1/17 | 13 | 13 | ||||||
# | 643217, 6.500%, due 6/1/17 | 53 | 55 | ||||||
# | 679247, 7.000%, due 8/1/17 | 206 | 214 | ||||||
# | 695910, 5.000%, due 5/1/18 | 208 | 220 | ||||||
# | 740847, 6.000%, due 10/1/18 | 113 | 119 | ||||||
# | 323501, 6.500%, due 1/1/19 | 43 | 49 | ||||||
# | 751313, 5.000%, due 3/1/19 | 206 | 221 | ||||||
# | 852864, 7.000%, due 7/1/20 | 572 | 616 | ||||||
# | 458147, 10.000%, due 8/15/20 | 109 | 119 | ||||||
# | 835563, 7.000%, due 10/1/20 | 228 | 248 | ||||||
# | 831430, 5.500%, due 3/1/21 | 375 | 411 | ||||||
# | 735574, 8.000%, due 3/1/22 | 166 | 180 | ||||||
# | 679253, 6.000%, due 10/1/22 | 465 | 531 | ||||||
FNR G93-19 SH, 11.234%, due 4/25/23, VRN | 11 | 16 |
NRSRO | |||||||||||
Rating | Principal | ||||||||||
Issuer | (unaudited) | Amount | Value | ||||||||
U.S. Government and U.S. Government Agency—(continued) | |||||||||||
Federal National Mortgage Association (FNMA)—(continued) | |||||||||||
# | 982878, 4.500%, due 5/1/23 | $ | 330 | $ | 355 | ||||||
# | AC5124, 4.000%, due 11/1/24 | 592 | 637 | ||||||||
# | 932095, 4.000%, due 11/1/24 | 6,153 | 6,628 | ||||||||
# | 932100, 4.500%, due 11/1/24 | 1,372 | 1,484 | ||||||||
# | AC6257, 4.000%, due 12/1/24 | 224 | 242 | ||||||||
# | AD4073, 4.000%, due 5/1/25 | 156 | 168 | ||||||||
# | 935995, 4.000%, due 6/1/25 | 136 | 147 | ||||||||
# | AE1176, 4.000%, due 8/1/25 | 434 | 468 | ||||||||
# | AD8164, 4.000%, due 8/1/25 | 574 | 618 | ||||||||
# | 255956, 5.500%, due 10/1/25 | 83 | 92 | ||||||||
# | AL2851, 4.000%, due 8/1/26 | 1,997 | 2,151 | ||||||||
# | AI9811, 4.500%, due 8/1/26 | 626 | 677 | ||||||||
# | AJ3203, 4.000%, due 10/1/26 | 1,412 | 1,521 | ||||||||
# | AJ7724, 4.000%, due 12/1/26 | 1,215 | 1,310 | ||||||||
# | 256639, 5.000%, due 2/1/27 | 16 | 17 | ||||||||
# | AB4818, 4.000%, due 4/1/27 | 2,745 | 2,960 | ||||||||
# | AL2590, 4.000%, due 7/1/27 | 2,075 | 2,237 | ||||||||
# | 806458, 8.000%, due 6/1/28 | 166 | 191 | ||||||||
# | 880155, 8.500%, due 7/1/29 | 232 | 274 | ||||||||
# | 797846, 7.000%, due 3/1/32 | 365 | 414 | ||||||||
# | 745519, 8.500%, due 5/1/32 | 169 | 201 | ||||||||
# | 654674, 6.500%, due 9/1/32 | 66 | 75 | ||||||||
# | 733897, 6.500%, due 12/1/32 | 250 | 285 | ||||||||
# | 254693, 5.500%, due 4/1/33 | 13 | 14 | ||||||||
# | 555531, 5.500%, due 6/1/33 | 34 | 38 | ||||||||
# | 555591, 5.500%, due 7/1/33 | 21 | 23 | ||||||||
# | 762505, 5.500%, due 11/1/33 | 198 | 225 | ||||||||
# | 776964, 5.000%, due 4/1/34 | 542 | 608 | ||||||||
# | 725424, 5.500%, due 4/1/34 | 134 | 151 | ||||||||
# | 824463, 5.500%, due 7/1/35 | 213 | 238 | ||||||||
# | 888884, 5.500%, due 12/1/35 | 268 | 304 | ||||||||
# | AL3449, 6.000%, due 7/1/36 | 1,404 | 1,623 | ||||||||
# | 886220, 6.000%, due 7/1/36 | 353 | 407 | ||||||||
# | 888703, 6.500%, due 8/1/37 | 1,396 | 1,647 | ||||||||
# | 928658, 6.500%, due 9/1/37 | 50 | 58 | ||||||||
# | 889385, 6.000%, due 2/1/38 | 641 | 732 | ||||||||
# | 962058, 6.500%, due 3/1/38 | 717 | 855 | ||||||||
# | 991911, 7.000%, due 11/1/38 | 224 | 255 | ||||||||
# | AC3237, 5.000%, due 10/1/39 | 212 | 238 | ||||||||
# | AC6156, 5.500%, due 11/1/39 | 2,729 | 3,165 | ||||||||
# | AB1200, 5.500%, due 7/1/40 | 628 | 717 | ||||||||
# | AL0028, 5.000%, due 2/1/41 | 1,623 | 1,820 | ||||||||
Total FNMA Mortgage Obligations | 39,534 | ||||||||||
Asset-Backed Securities—9.6% | |||||||||||
Avis Budget Rental Car Funding | |||||||||||
AESOP LLC—144A, 2010-3A, | |||||||||||
Tranche A, 4.640%, 5/20/16 | Aaa | 833 | 840 | ||||||||
Centre Point Funding LLC—144A, | |||||||||||
2010-1A, Tranche 1, | |||||||||||
5.430%, 7/20/16 | A2 | 471 | 477 | ||||||||
Chase Issuance Trust, 2008-A8, | |||||||||||
Tranche A8, | |||||||||||
1.361%, 5/15/17, VRN | AAA | 1,250 | 1,254 | ||||||||
Citibank Credit Card Issuance Trust, | |||||||||||
2008-A6, Tranche A6, | |||||||||||
1.366%, 5/22/17, VRN | AAA | 900 | 904 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 109 |
Income Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
NRSRO | |||||||||||
Rating | Principal | ||||||||||
Issuer | (unaudited) | Amount | Value | ||||||||
Asset-Backed Securities—(continued) | |||||||||||
Harley-Davidson Motorcycle Trust, | |||||||||||
2014-1, Tranche A2B, | |||||||||||
0.331%, 4/15/18, VRN | AAA | $ | 918 | $ | 917 | ||||||
Citibank Credit Card Issuance Trust, | |||||||||||
2008-A2, Tranche A2, | |||||||||||
1.314%, 1/23/20, VRN | AAA | 1,225 | 1,258 | ||||||||
GE Capital Credit Card Master Note Trust, 2012-6, Tranche B, | |||||||||||
1.830%, 8/17/20 | AA+ | 1,705 | 1,708 | ||||||||
SLM Student Loan Trust, 2002-1, | |||||||||||
Tranche B, 0.704%, | |||||||||||
1/25/21, VRN | AAA | 1,602 | 1,597 | ||||||||
SLM Private Education Loan Trust—144A, 2011-A, Tranche A3, | |||||||||||
2.661%, 1/15/43, VRN | AAA | 500 | 533 | ||||||||
Total Asset-Backed Securities | 9,488 | ||||||||||
Corporate Obligations—33.2% | |||||||||||
Bank of America Corporation, | |||||||||||
1.067%, due 3/22/16, VRN | A | 1,000 | 1,004 | ||||||||
JPMorgan Chase & Co., | |||||||||||
6.125%, due 6/27/17 | A | 1,000 | 1,104 | ||||||||
Macquarie Group Ltd.—144A, | |||||||||||
4.875%, due 8/10/17 | A3 | 1,000 | 1,070 | ||||||||
American Express Co., | |||||||||||
6.150%, due 8/28/17 | A+ | 1,000 | 1,115 | ||||||||
Standard Chartered Bank—144A, | |||||||||||
6.400%, due 9/26/17 | A+ | 1,000 | 1,117 | ||||||||
Morgan Stanley, | |||||||||||
6.625%, due 4/1/18 | A | 1,000 | 1,140 | ||||||||
Simon Property Group L.P., | |||||||||||
6.125%, due 5/30/18 | A | 1,000 | 1,139 | ||||||||
Bank of America Corporation, | |||||||||||
6.875%, due 11/15/18 | A | 1,000 | 1,164 | ||||||||
The Goldman Sachs Group, Inc., | |||||||||||
1.332%, due 11/15/18, VRN | A | 1,250 | 1,263 | ||||||||
Petrobras Global Finance BV, | |||||||||||
2.371%, due 1/15/19, VRN | Baa2 | 750 | 667 | ||||||||
Honeywell International, Inc., | |||||||||||
5.000%, due 2/15/19 | A | 1,000 | 1,122 | ||||||||
Tencent Holdings Ltd.—144A, | |||||||||||
3.375%, due 5/2/19 | A- | 500 | 509 | ||||||||
Citigroup, Inc., | |||||||||||
8.500%, due 5/22/19 | A | 1,000 | 1,247 | ||||||||
Baidu, Inc., | |||||||||||
2.750%, due 6/9/19 | A | 1,000 | 998 | ||||||||
Burlington Northern Santa Fe LLC, | |||||||||||
4.700%, due 10/1/19 | A3 | 1,000 | 1,107 | ||||||||
Boston Properties L.P., | |||||||||||
5.875%, due 10/15/19 | A- | 1,000 | 1,147 | ||||||||
Petroleos Mexicanos, | |||||||||||
6.000%, due 3/5/20 | A3 | 500 | 564 | ||||||||
Georgia-Pacific LLC—144A, | |||||||||||
5.400%, due 11/1/20 | A+ | 1,000 | 1,127 | ||||||||
Capital One Financial Corporation, | |||||||||||
4.750%, due 7/15/21 | A- | 1,000 | 1,104 | ||||||||
General Electric Capital Corporation, | |||||||||||
4.650%, due 10/17/21 | AA+ | 1,000 | 1,129 | ||||||||
Gilead Sciences, Inc., | |||||||||||
4.400%, due 12/1/21 | A- | 1,000 | 1,104 |
NRSRO | Principal | ||||||||||
Rating | Amount/ | ||||||||||
Issuer | (unaudited) | Contracts | Value | ||||||||
Corporate Obligations—(continued) | |||||||||||
Itau Unibanco Holding S.A.—144A, | |||||||||||
6.200%, due 12/21/21 | BBB | $ | 500 | $ | 527 | ||||||
Masco Corporation, | |||||||||||
5.950%, due 3/15/22 | BBB | 1,000 | 1,115 | ||||||||
American International Group, Inc., | |||||||||||
4.875%, due 6/1/22 | A- | 1,000 | 1,125 | ||||||||
Embraer S.A., | |||||||||||
5.150%, due 6/15/22 | BBB | 750 | 793 | ||||||||
Bancolombia S.A., | |||||||||||
5.125%, due 9/11/22 | BBB- | 1,000 | 996 | ||||||||
Jones Lang LaSalle, Inc., | |||||||||||
4.400%, due 11/15/22 | BBB | 625 | 650 | ||||||||
Wyndham Worldwide Corporation, | |||||||||||
3.900%, due 3/1/23 | BBB- | 750 | 741 | ||||||||
Toll Brothers Finance Corporation, | |||||||||||
4.375%, due 4/15/23 | BBB- | 850 | 837 | ||||||||
Fibria Overseas Finance, Ltd., | |||||||||||
5.250%, due 5/12/24 | BBB- | 1,000 | 996 | ||||||||
BRF S.A.—144A, | |||||||||||
4.750%, due 5/22/24 | BBB- | 1,000 | 974 | ||||||||
Grupo Bimbo S.A.B. de C.V.—144A, | |||||||||||
3.875%, due 6/27/24 | BBB | 1,000 | 1,006 | ||||||||
Crown Castle Towers LLC—144A, | |||||||||||
6.113%, due 1/15/40 | A2 | 1,000 | 1,151 | ||||||||
Total Corporate Obligations | 32,852 | ||||||||||
Total Long-Term Investments—98.4% (cost $96,241) | 97,315 | ||||||||||
Repurchase Agreement | |||||||||||
Fixed Income Clearing Corporation, | |||||||||||
0.010% dated 12/31/14, due 1/2/15, | |||||||||||
repurchase price $786, collateralized | |||||||||||
by FFCB, 2.700%, due 12/2/24 | 786 | 786 | |||||||||
Total Repurchase Agreement—0.8% (cost $786) | 786 | ||||||||||
Purchased Options | |||||||||||
Eurodollar Future, September 2016, | |||||||||||
Strike $97, Put | 150 | 36 | |||||||||
Eurodollar Future, September 2015, | |||||||||||
Strike $98, Put | 150 | 1 | |||||||||
Total Purchased Options—0.1% (premiums paid $108) | 37 | ||||||||||
Total Investments—99.3% (cost $97,135) | 98,138 | ||||||||||
Cash and other assets, | |||||||||||
less liabilities—0.7% | 716 | ||||||||||
Net assets—100.0% | $ | 98,854 |
NRSRO = Nationally Recognized Statistical Rating Organization—The credit quality ratings of the securities in the Fund reflect the highest category rating by either Fitch Ratings, Moody’s Investors Service Inc., or Standard & Poor’s, a division of the McGraw-Hill Companies, Inc.
The obligations of certain U.S. Government-sponsored securities are neither issued nor guaranteed by the U.S. Treasury.
VRN = Variable Rate Note
See accompanying Notes to Financial Statements.
110 | Annual Report | December 31, 2014 |
December 31, 2014 | William Blair Funds | 111 |
Low Duration Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | Since Inception(a) | |||||||||||||
Class N | 1.20 | % | 1.12 | % | 1.39 | % | 1.24 | % | ||||||||
Class I | 1.24 | 1.23 | 1.52 | 1.37 | ||||||||||||
Institutional Class | 1.40 | 1.39 | 1.69 | 1.55 | ||||||||||||
Bank of America Merrill Lynch 1-Year U.S. Treasury Note Index. | 0.18 | 0.23 | 0.41 | 0.38 |
(a) | For the period from December 1, 2009 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. From time to time, the investment adviser may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution (12b-1) fees. Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The Bank of America Merrill Lynch 1-Year U.S. Treasury Note Index is comprised of a single U.S. Treasury Note issue purchased at the beginning of the month and held for a full month. Each month the index is rebalanced and the issue selected is the outstanding U.S. Treasury Note that matures closest to, but not beyond one year from the rebalancing date.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all investments in the Fund performed the same, nor is there any guarantee that these investments will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total investments.
112 | Annual Report | December 31, 2014 |
Low Duration Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Principal | |||||||||
Issuer | Amount | Value | |||||||
U.S. Government and U.S. Government Agency—57.3% | |||||||||
U.S. Treasury Inflation Indexed Notes/Bonds—0.3% | |||||||||
U.S. Treasury Inflation Indexed Note, 1.625%, due 1/15/18 | $ | 567 | $ | 594 | |||||
Government National Mortgage Association (GNMA)—1.2% | |||||||||
GNR 2011-24 VA, 3.500%, due 2/20/16 | 470 | 477 | |||||||
1999-42, Tranche Z, 8.000%, due 11/16/29 | 1,343 | 1,553 | |||||||
Total GNMA Mortgage Obligations | 2,030 | ||||||||
Federal Home Loan Mortgage Corp. (FHLMC)—18.4% | |||||||||
# | E95760, 4.500%, due 4/1/18 | 11 | 11 | ||||||
# | E99582, 5.000%, due 9/1/18 | 16 | 17 | ||||||
# | B11362, 5.500%, due 12/1/18 | 37 | 39 | ||||||
# | B11849, 5.500%, due 1/1/19 | 99 | 105 | ||||||
# | B13870, 4.500%, due 5/1/19 | 83 | 88 | ||||||
# | G11604, 5.000%, due 7/1/19 | 95 | 101 | ||||||
# | G11596, 5.500%, due 8/1/19 | 82 | 88 | ||||||
# | G11605, 5.500%, due 9/1/19 | 42 | 45 | ||||||
# | G11697, 5.500%, due 4/1/20 | 743 | 793 | ||||||
# | J02537, 5.000%, due 9/1/20 | 63 | 67 | ||||||
# | G11836, 5.500%, due 12/1/20 | 21 | 22 | ||||||
# | G12113, 5.500%, due 5/1/21 | 206 | 223 | ||||||
# | E02322, 5.500%, due 5/1/22 | 45 | 49 | ||||||
# | G13124, 6.000%, due 12/1/22 | 137 | 152 | ||||||
# | J06871, 5.500%, due 1/1/23 | 122 | 129 | ||||||
# | J08450, 5.500%, due 7/1/23 | 56 | 61 | ||||||
# | J08703, 5.500%, due 9/1/23 | 111 | 120 | ||||||
# | J10351, 4.000%, due 7/1/24 | 214 | 231 | ||||||
# | C00351, 8.000%, due 7/1/24 | 76 | 90 | ||||||
# | J10600, 4.000%, due 8/1/24 | 14 | 15 | ||||||
# | G13695, 4.000%, due 9/1/24 | 965 | 1,039 | ||||||
# | J11208, 5.000%, due 11/1/24 | 133 | 147 | ||||||
# | G00363, 8.000%, due 6/1/25 | 111 | 128 | ||||||
# | J12853, 4.000%, due 8/1/25 | 144 | 155 | ||||||
# | C80329, 8.000%, due 8/1/25 | 22 | 26 | ||||||
# | J13022, 4.000%, due 9/1/25 | 1,989 | 2,142 | ||||||
# | J14491, 4.000%, due 2/1/26 | 4,807 | 5,177 | ||||||
# | G14150, 4.500%, due 4/1/26 | 2,579 | 2,787 | ||||||
# | J16051, 4.500%, due 7/1/26 | 3,143 | 3,397 | ||||||
# | G04053, 5.500%, due 3/1/38 | 1,903 | 2,164 | ||||||
# | G04424, 6.000%, due 6/1/38 | 125 | 142 | ||||||
# | G04778, 6.000%, due 7/1/38 | 141 | 161 | ||||||
# | A81372, 6.000%, due 8/1/38 | 60 | 69 | ||||||
# | G04544, 6.000%, due 8/1/38 | 603 | 684 | ||||||
# | G04687, 6.000%, due 9/1/38 | 151 | 172 | ||||||
# | G04745, 6.000%, due 9/1/38 | 77 | 88 | ||||||
# | A81799, 6.500%, due 9/1/38 | 526 | 626 | ||||||
# | G06964, 5.500%, due 11/1/38 | 4,528 | 5,112 | ||||||
# | G05723, 6.500%, due 11/1/38 | 2,199 | 2,500 | ||||||
# | A92646, 5.500%, due 6/1/40 | 374 | 426 | ||||||
# | G06017, 5.500%, due 6/1/40 | 1,767 | 2,011 | ||||||
# | 4122, Tranche FP, 0.561%, due 10/15/42, VRN | 1,134 | 1,136 | ||||||
Total FHLMC Mortgage Obligations | 32,735 |
Principal | |||||||||
Issuer | Amount | Value | |||||||
U.S. Government and U.S. Government Agency—(continued) | |||||||||
Federal National Mortgage Association (FNMA)—37.4% | |||||||||
# | 672953, 5.000%, due 12/1/17 | $ | 14 | $ | 15 | ||||
# | 888979, 6.000%, due 12/1/17 | 7 | 8 | ||||||
# | 683100, 5.500%, due 2/1/18 | 166 | 175 | ||||||
# | 678938, 5.500%, due 2/1/18 | 72 | 77 | ||||||
# | 695838, 5.500%, due 4/1/18 | 35 | 37 | ||||||
# | 697593, 5.000%, due 5/1/18 | 118 | 125 | ||||||
# | 735357, 5.500%, due 5/1/18 | 518 | 547 | ||||||
# | 704049, 5.500%, due 5/1/18 | 409 | 432 | ||||||
# | 709848, 5.000%, due 6/1/18 | 65 | 69 | ||||||
# | 705741, 5.000%, due 6/1/18 | 56 | 59 | ||||||
# | 656573, 5.000%, due 6/1/18 | 93 | 98 | ||||||
# | 728715, 5.000%, due 7/1/18 | 169 | 178 | ||||||
# | 735003, 5.500%, due 7/1/18 | 542 | 573 | ||||||
# | 711991, 5.000%, due 8/1/18 | 84 | 89 | ||||||
# | 257378, 5.000%, due 9/1/18 | 18 | 19 | ||||||
# | 743183, 5.000%, due 10/1/18 | 39 | 41 | ||||||
# | 749596, 5.000%, due 11/1/18 | 134 | 144 | ||||||
# | 753866, 6.000%, due 12/1/18 | 203 | 217 | ||||||
# | 761246, 5.000%, due 1/1/19 | 190 | 204 | ||||||
# | 766059, 5.500%, due 2/1/19 | 155 | 167 | ||||||
# | 766276, 5.000%, due 3/1/19 | 431 | 462 | ||||||
# | 751313, 5.000%, due 3/1/19 | 90 | 97 | ||||||
# | 779363, 5.000%, due 6/1/19 | 41 | 44 | ||||||
# | 785259, 5.000%, due 8/1/19 | 173 | 185 | ||||||
# | 761489, 5.500%, due 9/1/19 | 104 | 112 | ||||||
# | 788424, 5.500%, due 9/1/19 | 107 | 114 | ||||||
# | 725953, 5.000%, due 10/1/19 | 55 | 59 | ||||||
# | 745877, 5.000%, due 1/1/20 | 121 | 130 | ||||||
# | 357865, 5.000%, due 7/1/20 | 107 | 115 | ||||||
# | 888105, 5.000%, due 8/1/20 | 10 | 10 | ||||||
# | 357978, 5.000%, due 9/1/20 | 131 | 141 | ||||||
# | 745735, 5.000%, due 3/1/21 | 396 | 428 | ||||||
# | 879607, 5.500%, due 4/1/21 | 69 | 75 | ||||||
# | 831497, 6.000%, due 4/1/21 | 250 | 272 | ||||||
# | 831525, 5.500%, due 6/1/21 | 85 | 93 | ||||||
# | 880993, 6.000%, due 1/1/22 | 17 | 19 | ||||||
# | 972934, 5.500%, due 2/1/23 | 196 | 207 | ||||||
# | 889342, 5.000%, due 3/1/23 | 86 | 93 | ||||||
# | 982878, 4.500%, due 5/1/23 | 299 | 321 | ||||||
# | 889670, 5.500%, due 6/1/23 | 87 | 95 | ||||||
# | 555734, 5.000%, due 7/1/23 | 584 | 648 | ||||||
# | AE0011, 5.500%, due 9/1/23 | 106 | 116 | ||||||
# | 747339, 5.500%, due 10/1/23 | 316 | 360 | ||||||
# | AA4519, 4.500%, due 3/1/24 | 1,110 | 1,195 | ||||||
# | 934808, 4.500%, due 3/1/24 | 128 | 137 | ||||||
# | AA5028, 4.500%, due 4/1/24 | 236 | 254 | ||||||
# | AA5999, 4.500%, due 5/1/24 | 1,614 | 1,735 | ||||||
# | 931299, 4.500%, due 6/1/24 | 862 | 932 | ||||||
# | 190988, 9.000%, due 6/1/24 | 92 | 101 | ||||||
# | AC5410, 4.500%, due 10/1/24 | 416 | 450 | ||||||
# | 932095, 4.000%, due 11/1/24 | 167 | 180 | ||||||
# | AC6600, 4.500%, due 11/1/24 | 61 | 66 | ||||||
# | AC0596, 4.000%, due 12/1/24 | 281 | 303 | ||||||
# | AL3422, 5.000%, due 1/1/25 | 977 | 1,070 | ||||||
# | AC9560, 5.000%, due 1/1/25 | 2,411 | 2,588 | ||||||
# | AD8164, 4.000%, due 8/1/25 | 229 | 247 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 113 |
Low Duration Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
NRSRO | |||||||||||||
Rating | Principal | ||||||||||||
Issuer | (unaudited) | Amount | Value | ||||||||||
U.S. Government and U.S. Government Agency—(continued) | |||||||||||||
Federal National Mortgage Association (FNMA)—(continued) | |||||||||||||
# | AE1176, 4.000%, due 8/1/25 | $ | 488 | $ | 526 | ||||||||
# | AI4856, 4.500%, due 6/1/26 | 2,357 | 2,549 | ||||||||||
# | AI4872, 4.500%, due 6/1/26 | 27 | 30 | ||||||||||
# | AL2851, 4.000%, due 8/1/26 | 3,111 | 3,352 | ||||||||||
# | AK7384, 4.000%, due 3/1/27 | 2,800 | 3,019 | ||||||||||
# | AL2590, 4.000%, due 7/1/27 | 5,429 | 5,853 | ||||||||||
# | 741850, 5.500%, due 9/1/33 | 242 | 275 | ||||||||||
# | 741885, 5.500%, due 10/1/33 | 512 | 581 | ||||||||||
# | 759336, 6.000%, due 1/1/34 | 2,121 | 2,451 | ||||||||||
# | 809926, 5.500%, due 2/1/35 | 145 | 164 | ||||||||||
# | 829306, 6.000%, due 9/1/35 | 63 | 72 | ||||||||||
# | AL3449, 6.000%, due 7/1/36 | 2,247 | 2,597 | ||||||||||
# | 886762, 7.000%, due 9/1/36 | 578 | 639 | ||||||||||
# | 831926, 6.000%, due 12/1/36 | 972 | 1,116 | ||||||||||
# | 928574, 6.000%, due 7/1/37 | 104 | 119 | ||||||||||
# | 948637, 6.500%, due 8/1/37 | 792 | 903 | ||||||||||
# | 888703, 6.500%, due 8/1/37 | 5,214 | 6,151 | ||||||||||
# | 889385, 6.000%, due 2/1/38 | 916 | 1,046 | ||||||||||
# | 975649, 6.000%, due 7/1/38 | 217 | 250 | ||||||||||
# | 889987, 5.500%, due 8/1/38 | 138 | 157 | ||||||||||
# | AA7611, 5.000%, due 5/1/39 | 88 | 99 | ||||||||||
# | AA8706, 5.500%, due 6/1/39 | 3,659 | 4,243 | ||||||||||
# | AC3270, 5.500%, due 9/1/39 | 2,346 | 2,720 | ||||||||||
# | AC0505, 5.500%, due 9/1/39 | 1,083 | 1,243 | ||||||||||
# | 932638, 5.000%, due 3/1/40 | 256 | 287 | ||||||||||
# | AD3360, 5.500%, due 5/1/40 | 3,289 | 3,761 | ||||||||||
# | AD8810, 5.500%, due 6/1/40 | 1,217 | 1,392 | ||||||||||
# | AD8351, 5.500%, due 6/1/40 | 132 | 150 | ||||||||||
# | AB1200, 5.500%, due 7/1/40 | 79 | 90 | ||||||||||
# | AL0913, 6.000%, due 7/1/41 | 3,239 | 3,727 | ||||||||||
Total FNMA Mortgage Obligations | 66,290 | ||||||||||||
Asset-Backed Securities—23.6% | |||||||||||||
Hertz Vehicle Financing LLC—144A, 2009-2A, Tranche A2, 5.290%, 3/25/16 | Aaa | 1,475 | 1,483 | ||||||||||
Avis Budget Rental Car Funding AESOP LLC—144A, 2010-3A, Tranche A, 4.640%, 5/20/16 | Aaa | 1,667 | 1,681 | ||||||||||
Centre Point Funding LLC—144A, 2010-1A, Tranche 1, 5.430%, 7/20/16 | A2 | 824 | 835 | ||||||||||
Ford Credit Floorplan Master Owner Trust A—144A, 2010-3, Tranche A2, 1.861%, 2/15/17, VRN | AAA | 2,000 | 2,004 | ||||||||||
GE Dealer Floorplan Master Note Trust, 2012-1, Tranche A, 0.736%, 2/20/17, VRN | Aaa | 2,210 | 2,210 | ||||||||||
Chase Issuance Trust, 2008-A8, Tranche A8, 1.361%, 5/15/17, VRN | AAA | 3,000 | 3,011 | ||||||||||
Nissan Master Owner Trust, 2012-A, Tranche A, 0.631%, 5/15/17, VRN | Aaa | 2,296 | 2,298 |
NRSRO | ||||||||||||
Rating | Principal | |||||||||||
Issuer | (unaudited) | Amount | Value | |||||||||
Asset-Backed Securities—(continued) | ||||||||||||
Citibank Credit Card Issuance Trust, 2008-A6, Tranche A6, 1.366%, 5/22/17, VRN | AAA | $ | 200 | $ | 201 | |||||||
Ally Master Owner Trust, 2010-4, Tranche A, 1.231%, 8/15/17, VRN | Aaa | 1,125 | 1,130 | |||||||||
CNH Equipment Trust, 2014-B, Tranche A2, 0.480%, 8/15/17 | AAA | 1,400 | 1,400 | |||||||||
GE Dealer Floorplan Master Note Trust, 2012-4, Tranche A, 0.606%, 10/20/17, VRN | Aaa | 2,000 | 2,000 | |||||||||
Ford Credit Floorplan Master Owner Trust A, 2013-1, Tranche A2, 0.541%, 1/15/18, VRN | AAA | 1,900 | 1,901 | |||||||||
Discover Card Execution Note Trust, 2012-A5, Tranche A5, 0.361%, 1/16/18, VRN | AAA | 500 | 500 | |||||||||
Discover Card Execution Note Trust, 2010-A2, Tranche A2, 0.741%, 3/15/18, VRN | AAA | 350 | 351 | |||||||||
Harley-Davidson Motorcycle Trust, 2014-1, Tranche A2B, 0.331%, 4/15/18, VRN | AAA | 2,143 | 2,140 | |||||||||
Citibank Credit Card Issuance Trust, 2006-A8, Tranche A8, 0.271%, 12/17/18, VRN | AAA | 200 | 199 | |||||||||
Discover Card Master Trust, 2012-A4, Tranche A, 0.370%, 5/15/19, VRN | AAA | 2,000 | 2,009 | |||||||||
Bank of America Credit Card Trust, 2007-A11, Tranche A11, 0.231%, 12/15/19, VRN | AAA | 75 | 75 | |||||||||
Capital One Multi-Asset Execution Trust, 2007-A2, Tranche A2, 0.241%, 12/16/19, VRN | AAA | 215 | 214 | |||||||||
Citibank Credit Card Issuance Trust, 2008-A2, Tranche A2, 1.314%, 1/23/20, VRN | AAA | 2,000 | 2,054 | |||||||||
American Express Credit Account Secured Note Trust, 2012-4, Tranche A, 0.401%, 5/15/20, VRN | AAA | 2,200 | 2,197 | |||||||||
Citibank Credit Card Issuance Trust, 2013-A2, Tranche A2, 0.447%, 5/26/20, VRN | AAA | 1,900 | 1,899 | |||||||||
American Express Credit Account Master Trust, 2008-2, Tranche A, 1.421%, 9/15/20, VRN | AAA | 1,650 | 1,701 | |||||||||
SLM Student Loan Trust, 2002-1, Tranche B, 0.704%, 1/25/21, VRN | AAA | 3,604 | 3,592 | |||||||||
Bank of America Credit Card Trust, 2014-A1, Tranche A, 0.541%, 6/15/21, VRN | AAA | 1,000 | 1,000 | |||||||||
MBNA Credit Card Master Note Trust, 2004-A3, Tranche A3, 0.421%, 8/16/21, VRN | AAA | 475 | 473 |
See accompanying Notes to Financial Statements.
114 | Annual Report | December 31, 2014 |
Low Duration Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
NRSRO | ||||||||||||
Rating | Principal | |||||||||||
Issuer | (unaudited) | Amount | Value | |||||||||
Asset-Backed Securities—(continued) | ||||||||||||
SLM Student Loan Trust, 2008-4, Tranche A4, 1.884%, 7/25/22, VRN | Aaa | $ | 930 | $ | 979 | |||||||
SLM Private Education Loan Trust—144A, 2011-A, Tranche A3, 2.661%, 1/15/43, VRN | AAA | 2,250 | 2,396 | |||||||||
Total Asset-Backed Securities | 41,933 | |||||||||||
Corporate Obligations—13.2% | ||||||||||||
AT&T, Inc., 0.618%, due 2/12/16, VRN | A | 1,000 | 1,000 | |||||||||
Bank of America Corporation, 1.067%, due 3/22/16, VRN | A | 2,000 | 2,009 | |||||||||
The Goldman Sachs Group, Inc., 0.697%, due 3/22/16, VRN | A | 1,500 | 1,497 | |||||||||
Macquarie Bank Ltd.—144A, 0.691%, due 6/15/16, VRN | A | 1,400 | 1,402 | |||||||||
Verizon Communications, Inc., 1.771%, due 9/15/16, VRN | A- | 1,000 | 1,019 | |||||||||
Bayer US Finance LLC—144A, 0.482%, due 10/7/16, VRN | A- | 1,000 | 1,001 | |||||||||
Capital One Bank USA NA, 0.733%, due 2/13/17, VRN | A3 | 1,500 | 1,504 | |||||||||
JPMorgan Chase & Co., 0.752%, due 2/15/17, VRN | A+ | 1,000 | 998 | |||||||||
Nissan Motor Acceptance Corp.—144A, 0.785%, due 3/3/17, VRN | A- | 1,500 | 1,506 | |||||||||
Citigroup, Inc., 0.778%, due 3/10/17, VRN | A | 1,000 | 998 | |||||||||
Mizuho Bank Ltd.—144A, 0.659%, due 4/16/17, VRN | A+ | 1,000 | 1,001 | |||||||||
Tencent Holdings Ltd.—144A, 2.000%, due 5/2/17 | A- | 1,200 | 1,198 | |||||||||
General Electric Capital Corporation, 0.512%, due 5/15/17, VRN | AA+ | 1,500 | 1,498 | |||||||||
American Express Credit Corporation, 0.505%, due 6/5/17, VRN | A+ | 1,000 | 999 | |||||||||
Standard Chartered plc—144A, 0.575%, due 9/8/17, VRN | AA- | 2,000 | 1,992 | |||||||||
Royal Bank of Canada, 0.488%, due 10/13/17, VRN | AA | 1,725 | 1,725 | |||||||||
Canadian National Railway Co., 0.403%, due 11/14/17, VRN | A | 500 | 500 | |||||||||
General Electric Capital Corporation, 0.750%, due 12/7/17, VRN | AA+ | 500 | 498 | |||||||||
Wells Fargo & Co., 0.861%, due 4/23/18, VRN | AA- | 1,000 | 1,002 | |||||||||
Total Corporate Obligations | 23,347 | |||||||||||
Total Long-Term Investments—94.1% (cost $167,065) | 166,929 |
Principal | ||||||||
Amount/ | ||||||||
Issuer | Contracts | Value | ||||||
Repurchase Agreement | ||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $9,920, collateralized by Federal Home Loan Bank, 5.250%, due 6/12/37 | $ | 9,920 | $ | 9,920 | ||||
Total Repurchase Agreement—5.6% (cost $9,920) | 9,920 | |||||||
Purchased Options | ||||||||
Eurodollar Future, September 2015, Strike $98, Put | 300 | 2 | ||||||
Eurodollar Future, September 2016, Strike $97, Put | 300 | 71 | ||||||
Total Purchased Options—0.0% (premiums paid $215) | 73 | |||||||
Total Investments—99.7% (cost $177,200) | 176,922 | |||||||
Securities Sold, Not Yet Purchased | ||||||||
U.S. Government and U.S. Government Agency—(5.7)% | ||||||||
Federal National Mortgage Association (FNMA)—(5.7)% | ||||||||
TBA, 2.500%, due 1/1/30 | (10,000 | ) | (10,182 | ) | ||||
Total Securities Sold, Not Yet Purchased—(5.7)% (proceeds $10,143) | (10,182 | ) | ||||||
Cash and other assets less liabilities—6.0% | 10,757 | |||||||
Net assets—100.0% | $ | 177,497 |
VRN = Variable Rate Note
NRSRO = Nationally Recognized Statistical Rating Organization—The credit quality ratings of the securities in the Fund reflect the highest category rating by either Fitch Ratings, Moody’s Investors Service Inc., or Standard & Poor’s, a division of the McGraw-Hill Companies, Inc.
The obligations of certain U.S. Government-sponsored securities are neither issued nor guaranteed by the U.S. Treasury.
TBA = Mortgage-backed securities traded under delayed delivery commitments, settling after December 31, 2014. The term TBA comes from the fact that the specific mortgage-backed security that will be delivered to fulfill a TBA trade is not designated at the time the trade is made.
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 115 |
116 | Annual Report | December 31, 2014 |
Ready Reserves Fund
Performance Highlights (Unaudited)
The Fund’s 7 day yield on December 31, 2014 was 0.01%.
Average Annual Total Return at 12/31/2014 | ||||||||||||||||
1 Year | 3 Year | 5 Year | 10 Year | |||||||||||||
Class N | 0.01 | % | 0.01 | % | 0.01 | % | 1.40 | % | ||||||||
AAA Rated Money Market Funds | 0.01 | 0.01 | 0.01 | 1.39 | ||||||||||||
30 Day Treasury Bills | 0.02 | 0.04 | 0.06 | 1.38 |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. Class N Shares are available to the general public without a sales load. Total return includes reinvestment of income. Yields fluctuate and are not guaranteed. An investment in the Fund is neither insured nor guaranteed by the Federal Deposit Insurance Corp. (FDIC) or any government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.
The AAA Rated Money Market Funds represents the average annual composite performance of all AAA rated First Tier Retail Money Market Funds listed by iMoneyNet data.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all fixed-income securities in the Fund performed the same, nor is there any guarantee that these fixed-income securities will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Sector Diversification (Unaudited)
The sector diversification shown is based on the total investments.
December 31, 2014 | William Blair Funds | 117 |
Ready Reserves Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Principal | Amortized | ||||||||
Issuer | Amount | Cost | |||||||
U.S. Government and U.S. Government Agency—8.9% | |||||||||
Federal Home Loan Bank (FHLB)—5.0% | |||||||||
Federal Home Loan Bank, 0.030%-2.750%, 1/7/15-3/13/15 | $ | 71,010 | $ | 71,021 | |||||
Federal Home Loan Mortgage Corp. (FHLMC)—0.3% | |||||||||
Federal Home Loan Mortgage Corporation, 0.075%, 2/6/15-2/10/15 | 3,760 | 3,760 | |||||||
Federal National Mortgage Association (FNMA)—3.6% | |||||||||
Federal National Mortgage Association, 0.055%-0.090%, 1/5/15-3/4/15 | 51,250 | 51,248 | |||||||
Corporate Notes—2.6% | |||||||||
American Honda Finance Corporation, 0.229%, 10/7/15, VRN | 5,000 | 5,000 | |||||||
Caterpillar Financial Services Corporation, 0.302%-0.582%, 2/9/15-2/19/15, VRN | 2,800 | 2,800 | |||||||
Caterpillar Financial Services Corporation, 1.050%, 3/26/15 | 4,492 | 4,500 | |||||||
General Electric Capital Corporation, 1.625%-3.500%, 1/9/15-7/2/15 | 6,632 | 6,669 | |||||||
John Deere Capital Corporation, 0.875%-0.950%, 4/17/15-6/29/15 | 4,027 | 4,038 | |||||||
PACCAR Financial Corporation, 1.050%, 6/5/15 | 2,350 | 2,358 | |||||||
US Bancorp, 3.125%, 4/1/15 | 6,200 | 6,244 | |||||||
Wal-Mart Stores, Inc., 2.250%, 7/8/15 | 5,838 | 5,898 | |||||||
Total Corporate Notes | 37,507 | ||||||||
Commercial Paper—64.0% | |||||||||
Abbot Laboratories, 0.090%-0.150%, 1/7/15-2/26/15 | 49,700 | 49,694 | |||||||
American Honda Finance Corporation, 0.080%-0.120%, 1/8/15-2/10/15 | 42,000 | 41,998 | |||||||
Caterpillar Financial Services Corporation, 0.100%-0.120%, 1/20/15-2/19/15 | 27,710 | 27,706 | |||||||
Chevron Corporation, 0.080%-0.110%, 1/12/15-2/6/15 | 49,000 | 48,997 | |||||||
Coca-Cola Co. (The), 0.080%-0.110%, 1/12/15-2/20/15 | 47,145 | 47,140 | |||||||
ConocoPhillips Qatar Funding, Ltd., 0.110%-0.170%, 1/5/15-3/16/15 | 44,960 | 44,955 | |||||||
Dover Corporation, 0.120%-0.150%, 1/2/15-1/6/15 | 50,000 | 50,000 | |||||||
Eli Lilly & Co., 0.100%-0.180%, 1/28/15-3/25/15 | 47,791 | 47,779 | |||||||
Govco L.L.C., 0.130%-0.170%, 1/12/15-2/25/15 | 37,600 | 37,597 | |||||||
Illinois Tool Works, Inc., 0.090%-0.120%, 1/2/15-1/26/15 | 46,000 | 45,999 | |||||||
John Deere Capital Corporation, 0.100%, 1/6/15-1/8/15 | 21,000 | 21,000 | |||||||
John Deere Credit, Ltd., 0.100%-0.130%, 1/14/15-2/5/15 | 21,000 | 20,999 | |||||||
Johnson & Johnson, 0.060%-0.070%, 1/8/15-1/15/15 | 46,000 | 46,000 | |||||||
Kimberly-Clark Worldwide, Inc., 0.080%-0.120%, 1/6/15-1/20/15 | 47,300 | 47,299 |
Principal | Amortized | ||||||||
Issuer | Amount | Cost | |||||||
U.S. Government and U.S. Government Agency—(continued) | |||||||||
Commercial Paper—(continued) | |||||||||
Microsoft Corporation, 0.070%-0.100%, 1/7/15-3/4/15 | $ | 48,900 | $ | 48,896 | |||||
PACCAR Financial Corporation, 0.080%-0.140%, 1/2/15-2/12/15 | 46,700 | 46,699 | |||||||
PepsiCo, Inc., 0.080%-0.120%, 1/20/15-1/26/15 | 18,900 | 18,899 | |||||||
Praxair, Inc., 0.110%, 1/28/15 | 10,775 | 10,774 | |||||||
Private Export Funding Corporation, 0.200%-0.250%, 2/6/15-3/20/15 | 18,200 | 18,193 | |||||||
Procter & Gamble Co., 0.100%, 1/6/15-1/29/15 | 30,000 | 29,998 | |||||||
Roche Holdings, Inc., 0.080%-0.100%, 1/5/15-2/23/15 | 45,000 | 44,997 | |||||||
Toyota Credit de Puerto Rico Corporation, 0.080%-0.130%, 1/21/15-2/5/15 | 41,000 | 40,995 | |||||||
Toyota Motor Credit Corporation, 0.130%, 2/4/15 | 8,000 | 7,999 | |||||||
Unilever Capital Corporation, 0.120%, 1/6/15-1/20/15 | 30,000 | 29,999 | |||||||
Walt Disney Co. (The), 0.080%-0.150%, 1/26/15-3/25/15 | 32,700 | 32,692 | |||||||
Total Commercial Paper | 907,304 | ||||||||
Repurchase Agreements—24.5% | |||||||||
Bank of America, 0.060% dated 12/31/14, due 1/2/15, repurchase price $65,000, collateralized by FCSB, 2.000%-2.640%, due 12/30/19-12/17/24, and FHLB, 0.625%-2.350%, due 11/23/16-8/8/22, and FMAC, 0.000%, due 12/14/29, and FNMA, 6.120%, due 3/23/28 | 65,000 | 65,000 | |||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $232,790, collateralized by U.S. Treasury Note, 2.375%, due 8/15/24 | 232,790 | 232,790 | |||||||
Goldman Sachs, 0.080% dated 12/31/14, due 1/2/15, repurchase price $50,000, collateralized by U.S. Treasury Strips, 0.000%-6.875%, due 8/15/25-5/15/44 | 50,000 | 50,000 | |||||||
Total Repurchase Agreements | 347,790 | ||||||||
Total Investments—100.0% (cost $1,418,630) | 1,418,630 | ||||||||
Cash and other assets, less liabilities—0.0% | 57 | ||||||||
Net assets—100.0% | $ | 1,418,687 | |||||||
Portfolio Weighted Average Maturity | 23 days |
VRN = Variable Rate Note
See accompanying Notes to Financial Statements.
118 | Annual Report | December 31, 2014 |
| |
Brian D. Singer
Thomas Clarke | The Macro Allocation Fund changed its fiscal year end from October 31 to December 31 and is reporting results for a shortened fiscal period from October 31, 2014 to December 31, 2014. During this two month period, the Macro Allocation Fund posted a 2.0% decrease (Class N shares). By comparison, the Fund’s primary benchmark, the Bank of America Merrill Lynch U.S. 1-3 Month Treasury Bill Index returned 0.002%.
For the two-month period the Fund suffered small detractions from both its market-oriented strategies and its currency-oriented strategies during this time period. Short exposures to sovereign fixed income in Europe and from long exposures to emerging equity markets proved to be a detractor during this time period. The Fund’s market-oriented strategies benefited from exposures within U.S. equity (long Large and Value and short Small and Growth) as well as from a long exposure to U.S. Treasuries. The Fund’s currency-oriented strategies benefited from short exposures to the Australian dollar and the Swiss franc but were hurt by long exposures to the Malaysian ringgit and the Indian rupee.
We believe that our investment philosophy and process is well equipped to navigate an environment where market (equity and fixed income) opportunities are low relative to prior years and currency opportunities are enhanced. We will continue to employ appropriate tools to gain insight and understanding in environments where geopolitical influences are significant and macro-thematic forces cut across the investment landscape. We remain vigilant as we assess new relevant information to capture future investment opportunities in a timely manner and will continue balancing the relationship between risk taken and compensation expected. |
December 31, 2014 | William Blair Funds | 119 |
Macro Allocation Fund
Performance Highlights (Unaudited)
Average Annual Total Return at 12/31/2014 | ||||||||||||
Since | ||||||||||||
1 Year | 3 Year | Inception | ||||||||||
Class N(a) | 2.55 | % | 9.84 | % | 10.46 | % | ||||||
Class I(a) | 2.83 | 10.11 | 10.73 | |||||||||
BofA Merrill Lynch 3-Month U.S.Treasury Bill Index(a) | 0.03 | 0.07 | 0.07 | |||||||||
Long-Term Comparative Index(a) | 3.72 | 5.29 | 5.63 | |||||||||
Institutional Class(b) | 2.94 | — | 4.09 | |||||||||
BofA Merrill Lynch 3-Month U.S.Treasury Bill Index(b) | 0.03 | — | 0.05 | |||||||||
Long-Term Comparative Index(b) | 3.72 | — | 3.76 |
(a) | For the period from November 29, 2011 (Commencement of Operations) to December 31, 2014. |
(b) | For the period from October 21, 2013 (Commencement of Operations) to December 31, 2014. |
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are average annual total returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272, or visit our Web site at www.williamblairfunds.com. The Fund involves a high level of risk and may not be appropriate for everyone. You could lose money by investing in the Fund. There can be no assurance that the Fund’s investment objective will be achieved or that the Fund’s investment strategies will be successful. The Fund is not a complete investment program. From time to time, the investment advisor may waive fees or reimburse expenses for the Fund. Without these waivers, performance would be lower. Class N shares are available to the general public without a sales load. Class I shares are available to certain institutional investors and advisory clients of William Blair & Company, L.L.C., without a sales load or distribution fee (12b-1 fee). Institutional Class Shares are available to institutional investors without a sales load or distribution (12b-1) or service fees.
The performance highlights and graph presented above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
The BofA Merrill Lynch 3-Month U.S. Treasury Bill Index measures total return on cash, including price and interest income, based on short-term government Treasury Bills of about 90-day maturity. The Index is unmanaged, does not incur fees or expenses, and cannot be invested in directly.
The Long-Term Comparative Index return is comprised of the following indices: 40% Barclays Capital U.S. Aggregate Index, 30% Morgan Stanley Capital International (MSCI) All Country World Index (net), and 30% BofA Merrill Lynch 3-month U.S. Treasury Bill Index.
This report identifies the Fund’s investments on December 31, 2014. These holdings are subject to change. Not all investments in the Fund performed the same, nor is there any guarantee that these investments will perform as well in the future. Market forecasts provided in this report may not necessarily come to pass.
Portfolio Allocation (Unaudited)
The table below provides the allocation of the Fund’s holdings as a percent of net assets as of December 31, 2014.
Category | % | |||
Equity Exchange-Traded Funds | 40.8 | % | ||
Fixed Income Exchange-Traded Funds | 17.2 | % | ||
Common Stock | 0.5 | % | ||
U.S. Government | 9.6 | % | ||
Purchased options | 0.8 | % | ||
Repurchase Agreements | 31.2 | % | ||
Written Option | -0.1 | % | ||
Cash and other assets, less liabilities | 0.0 | % | ||
Net Assets | 100.0 | % |
120 | Annual Report | December 31, 2014 |
Macro Allocation Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Shares or | ||||||||
Principal | ||||||||
Issuer | Amount | Value | ||||||
Exchange-Traded Funds—58.0% | ||||||||
Equity Exchange-Traded Funds-—40.8% | ||||||||
Guggenheim China Small Cap ETF | 957,000 | $ | 24,872 | |||||
Guggenheim Frontier Markets ETF | 243,000 | 3,373 | ||||||
iShares Global Energy ETF | 752,000 | 27,967 | ||||||
iShares MSCI Brazil Capped ETF | 260,000 | 9,508 | ||||||
iShares MSCI Japan ETF | 1,198,000 | 13,465 | ||||||
iShares Russell 1000 Value ETF | 1,289,000 | 134,572 | ||||||
Market Vectors Russia ETF | 1,263,000 | 18,465 | ||||||
SPDR S&P 500 ETF Trust | 651,000 | 133,780 | ||||||
SPDR S&P Emerging Markets Small Cap ETF(a) | 438,000 | 19,421 | ||||||
Vanguard FTSE Emerging Markets ETF | 129,000 | 5,163 | ||||||
Total Equity Exchange-Traded Funds | 390,586 | |||||||
Fixed Income Exchange-Traded Funds—17.2% | ||||||||
iShares iBoxx $ Investment Grade Corporate Bond ETF | 1,021,000 | 121,918 | ||||||
SPDR Barclays High Yield Bond ETF | 919,000 | 35,482 | ||||||
WisdomTree Emerging Markets Local Debt Fund ETF | 186,000 | 7,738 | ||||||
Total Fixed Income Exchange-Traded Funds | 165,138 | |||||||
Total Exchange-Traded Funds—58.0% (cost $544,100) | 555,724 | |||||||
Common Stock—0.5% | ||||||||
Europe—0.5% | ||||||||
France—0.5% | ||||||||
Schneider Electric S.A. (Electrical equipment) | 68,000 | 4,953 | ||||||
Total Common Stock—0.5% (cost $5,477) | 4,953 | |||||||
Repurchase Agreement—31.2% | ||||||||
Fixed Income Clearing Corporation, 0.010% dated 12/31/14, due 1/2/15, repurchase price $ 299,033, collateralized by Federal Farm Credit Bank, 2.700%, due 12/2/24, and Federal Home Loan Bank, 2.750%-5.250%, due 12/13/24-6/12/37, and Federal National Mortgage Association, 3.250%-6.625%, due 11/15/30-5/27/33 | $ | 299,033 | 299,033 | |||||
Total Repurchase Agreement—31.2% (cost $299,033) | 299,033 | |||||||
U.S. Government—9.6% | ||||||||
U.S. Treasury Bill, 0.005%, due 1/8/15 | 7,000 | 7,000 | ||||||
U.S. Treasury Bill, 0.019%, due 2/5/15(b) | 10,000 | 10,000 | ||||||
U.S. Treasury Bill, 0.013%, due 3/5/15(b) | 8,000 | 8,000 | ||||||
U.S. Treasury Bill, 0.035%, due 4/2/15(b) | 8,000 | 7,999 | ||||||
U.S. Treasury Bill, 0.040%, due 4/30/15(a) (b) | 8,000 | 7,999 |
Shares/ | ||||||||
Principal | ||||||||
Amount/ | ||||||||
Issuer | Contracts | Value | ||||||
U.S. Government—(continued) | ||||||||
U.S. Treasury Bill, 0.060%, due 5/28/15(a) (b) | $ | 8,000 | $ | 7,998 | ||||
U.S. Treasury Bill, 0.083%, due 6/25/15(a) (b) | 8,000 | 7,997 | ||||||
U.S. Treasury Bill, 0.108%, due 7/23/15(a) (b) | 10,000 | 9,994 | ||||||
U.S. Treasury Bill, 0.151%, due 8/20/15(a) (b) | 5,000 | 4,995 | ||||||
U.S. Treasury Bill, 0.166%, due 9/17/15(a) (b) | 5,000 | 4,994 | ||||||
U.S. Treasury Bill, 0.174%, due 10/15/15(a) (b) | 5,000 | 4,993 | ||||||
U.S. Treasury Bill, 0.171%, due 11/12/15(a) (b) | 5,000 | 4,993 | ||||||
U.S. Treasury Bill, 0.212%, due 12/10/15(a) | 5,000 | 4,990 | ||||||
Total U.S. Government—9.6% (cost $91,948) | 91,952 | |||||||
Purchased Options—0.8% | ||||||||
EUR PUT/JPY CALL, January 2015,Strike 145.5 | 60,794,000 | 957 | ||||||
Euro STOXX 50 Index, February 2015,Strike €3,175, CALL | 2,000 | 2,171 | ||||||
Euro STOXX 50 Index, March 2015,Strike €3,250, CALL | 263 | 267 | ||||||
Euro STOXX 50 Index, March 2015,Strike €3,350, CALL | 2,589 | 1,335 | ||||||
FTSE 100 Index, March 2015,Strike £6,725, CALL | 99 | 133 | ||||||
iShares MSCI Emerging Markets,June 2015, Strike $41, CALL | 9,694 | 1,401 | ||||||
S&P 500 Index, March 2015,Strike $2,075, CALL | 253 | 1,262 | ||||||
Total Purchased Options—0.8% (premiums paid $9,088) | 7,526 | |||||||
Total Investments in Securities—100.1% (cost $949,646) | 959,188 | |||||||
Written Option—(0.1)% | ||||||||
Energy Select Sector SPDR Fund,January 2015, Strike $78, PUT | (3,800 | ) | (505 | ) | ||||
Total Written Option—(0.1)% (premium received $820) | (505 | ) | ||||||
Cash and other assets, less liabilities—0.0% | 3 | |||||||
Net assets—100.0% | $ | 958,686 |
(a) Security, or portion of security, is segregated as collateral for OTC swap contracts aggregating a total value of $37,487.
(b) Security, or portion of security, is pledged as collateral to cover initial margin requirements on open futures contracts and centrally cleared swaps aggregating a total value of $37,857.
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 121 |
Macro Allocation Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Forward Foreign Currency Contracts
Net Unrealized/ | ||||||||||||||||
Settlement | Local Currency | Appreciation | ||||||||||||||
Date | Deliver/Receive | Counterparty | (in thousands) | Current Value | (Depreciation) | |||||||||||
Purchased | ||||||||||||||||
2/18/15 | Chinese Yuan Renminbi | State Street Bank & Trust Company | 17,996 | $ | 2,884 | $ | (37 | ) | ||||||||
2/18/15 | Japanese Yen | State Street Bank & Trust Company | 597,873 | 4,994 | 66 | |||||||||||
2/18/15 | Malaysian Ringgit | State Street Bank & Trust Company | 8,877 | 2,529 | (107 | ) | ||||||||||
3/18/15 | Australian Dollar | State Street Bank & Trust Company | 35,444 | 28,772 | (7 | ) | ||||||||||
3/18/15 | Brazilian Real | State Street Bank & Trust Company | 10,580 | 3,894 | (67 | ) | ||||||||||
3/18/15 | Chinese Yuan Renminbi | State Street Bank & Trust Company | 683,673 | 109,223 | (1,441 | ) | ||||||||||
3/18/15 | Colombian Peso | State Street Bank & Trust Company | 38,958,391 | 16,323 | 72 | |||||||||||
3/18/15 | Hungarian Forint | State Street Bank & Trust Company | 7,212,829 | 27,513 | (1,475 | ) | ||||||||||
3/18/15 | Indonesian Rupiah | State Street Bank & Trust Company | 829,759,908 | 66,053 | (169 | ) | ||||||||||
3/18/15 | Indian Rupee | State Street Bank & Trust Company | 10,445,772 | 162,779 | (3,104 | ) | ||||||||||
3/18/15 | South Korean Won | State Street Bank & Trust Company | 63,216,798 | 57,307 | 252 | |||||||||||
3/18/15 | Mexican Peso | State Street Bank & Trust Company | 626,735 | 42,272 | (690 | ) | ||||||||||
3/18/15 | Malaysian Ringgit | State Street Bank & Trust Company | 342,569 | 97,344 | (356 | ) | ||||||||||
3/18/15 | Philippine Peso | State Street Bank & Trust Company | 699,838 | 15,589 | (46 | ) | ||||||||||
3/18/15 | Polish Zloty | State Street Bank & Trust Company | 95,955 | 27,007 | (1,335 | ) | ||||||||||
3/18/15 | Taiwan Dollar | State Street Bank & Trust Company | 987,585 | 31,267 | (508 | ) | ||||||||||
3/18/15 | South African Rand | State Street Bank & Trust Company | 155,270 | 13,250 | 83 | |||||||||||
$ | (8,869 | ) | ||||||||||||||
Sold | ||||||||||||||||
2/18/15 | Swiss Franc | State Street Bank & Trust Company | 4,430 | $ | 4,460 | $ | 154 | |||||||||
2/18/15 | Danish Krone | State Street Bank & Trust Company | 14,224 | 2,312 | 87 | |||||||||||
2/18/15 | Japanese Yen | State Street Bank & Trust Company | 2,293,477 | 19,156 | 1,041 | |||||||||||
2/18/15 | Singapore Dollar | State Street Bank & Trust Company | 3,086 | 2,327 | 64 | |||||||||||
3/18/15 | Australian Dollar | State Street Bank & Trust Company | 130,885 | 106,246 | 1,813 | |||||||||||
3/18/15 | Swiss Franc | State Street Bank & Trust Company | 167,574 | 168,803 | 4,650 | |||||||||||
3/18/15 | Czech Koruna | State Street Bank & Trust Company | 921,673 | 40,303 | 1,267 | |||||||||||
3/18/15 | Danish Krone | State Street Bank & Trust Company | 525,444 | 85,438 | 2,446 | |||||||||||
3/18/15 | Euro | State Street Bank & Trust Company | 94,988 | 115,023 | 2,965 | |||||||||||
3/18/15 | British Pound Sterling | State Street Bank & Trust Company | 3,385 | 5,272 | 44 | |||||||||||
3/18/15 | Hong Kong Dollar | State Street Bank & Trust Company | 225,436 | 29,070 | 8 | |||||||||||
3/18/15 | Indian Rupee | State Street Bank & Trust Company | 1,997,347 | 31,125 | (278 | ) | ||||||||||
3/18/15 | New Zealand Dollar | State Street Bank & Trust Company | 85,943 | 66,528 | (751 | ) | ||||||||||
3/18/15 | Swedish Krona | State Street Bank & Trust Company | 339,976 | 43,624 | 1,570 | |||||||||||
3/18/15 | Singapore Dollar | State Street Bank & Trust Company | 122,702 | 92,508 | 989 | |||||||||||
$ | 16,069 |
Futures Contracts | ||||||||||||||
Notional Amount | Net Unrealized | |||||||||||||
Number of | (Local, | Appreciation | ||||||||||||
Contracts | Description | Expiration Date | Local Currency | in thousands) | (Depreciation) | |||||||||
Long | ||||||||||||||
292 | Amsterdam Index | January 2015 | Euro | 24,820 | $ | 1,947 | ||||||||
537 | IBEX 35 Index | January 2015 | Euro | 55,012 | 1,072 | |||||||||
340 | MSCI Singapore ETS Index | January 2015 | Singapore Dollar | 25,949 | 106 | |||||||||
110 | MSCI Taiwan Index | January 2015 | U.S. Dollar | 3,774 | 60 | |||||||||
320 | KOSPI 12 Index | March 2015 | South Korean Won | 39,040,000 | (1,323 | ) | ||||||||
42 | S&P TSX 60 Index | March 2015 | Canadian Dollar | 7,153 | 328 | |||||||||
108 | SPI 200 Index | March 2015 | Australian Dollar | 14,534 | 487 | |||||||||
470 | FTSE 100 Index | March 2015 | British Pound Sterling | 30,656 | 2,205 | |||||||||
572 | FTSE MIB Index | March 2015 | Euro | 54,537 | 3,763 | |||||||||
50 | Russell 2000 Mini Index | March 2015 | U.S. Dollar | 6,004 | (2 | ) | ||||||||
768 | 5YR US Treasury Notes* | March 2015 | U.S. Dollar | 91,338 | 19 | |||||||||
$ | 8,662 | |||||||||||||
Short | ||||||||||||||
145 | CAC 40 Index | January 2015 | Euro | 6,202 | $ | (456 | ) | |||||||
288 | EURO-BTP | March 2015 | Euro | 39,053 | (544 | ) | ||||||||
288 | EURO-OAT* | March 2015 | Euro | 42,399 | (580 | ) | ||||||||
96 | German Euro Bund* | March 2015 | Euro | 14,964 | (248 | ) | ||||||||
520 | 10YR JGB Mini | March 2015 | Japanese Yen | 7,687,680 | (417 | ) | ||||||||
1,040 | FTSE 40 Index | March 2015 | South African Rand | 460,283 | (1,436 | ) | ||||||||
342 | 10YR Can Bond | March 2015 | Canadian Dollar | 47,374 | (763 | ) | ||||||||
410 | 10YR US Treasury Notes* | March 2015 | U.S. Dollar | 51,987 | (313 | ) | ||||||||
27 | DAX Index | March 2015 | Euro | 6,644 | (330 | ) | ||||||||
115 | EURO STOXX 50 Index | March 2015 | Euro | 3,603 | 64 | |||||||||
1,585 | S&P 500 E Mini Index | March 2015 | U.S. Dollar | 162,653 | (4,896 | ) | ||||||||
216 | Long Gilt | March 2015 | British Pound Sterling | 25,818 | (1,068 | ) | ||||||||
$ | (10,987 | ) |
* | Exposure to Futures Contract is achieved through the use of a swap contract with Credit Suisse. |
See accompanying Notes to Financial Statements.
122 | Annual Report | December 31, 2014 |
Macro Allocation Fund
Portfolio of Investments, December 31, 2014 (all dollar amounts in thousands)
Total Return Swaps
Unrealized | ||||||||||||||||
Pay/Receive | Maturity | Notional | Appreciation | |||||||||||||
Reference Entity | Floating Rate | Floating Rates | Dates | Counterparty | Amount | (Depreciation) | ||||||||||
Industrial Select Sector Fund | Receive | 1 Month LIBOR minus 45 bp | Mar 2015 to Nov 2015 | Credit Suisse International | $40,507 | $ (4,499 | ) | |||||||||
iShares Russell 2000 Fund | Receive | 1 Month LIBOR minus 80 bp–100 bp | Mar 2015 to Jan 2016 | Credit Suisse International | 77,066 | (7,086 | ) | |||||||||
Russell 1000 Growth Total Return Index | Receive | 1 Month LIBOR plus 80 bp | Jan 2015 | Goldman Sachs International | 59,785 | 547 | ||||||||||
U.S. Equity Basket - Energy Sector | Pay | 1 Month LIBOR plus 45 bp | Mar 2015 to Nov 2015 | Credit Suisse International | 39,199 | (2,372 | ) | |||||||||
$(13,410 | ) |
Centrally Cleared Credit Default Swaps
Unrealized | ||||||||||||||||
Buy/Sell | Fixed Deal | Maturity | Notional | Appreciation | ||||||||||||
Reference Entity | Protection | Receive Rate | Dates | Cleared Exchange | Amount | (Depreciation) | ||||||||||
CDX.IG-22 | Sell | 1.00% | June 2019 | CME | $ | 1,000 | $ (0 | )(c) | ||||||||
CDX.HY-22 | Sell | 5.00% | June 2019 | ICE | 990 | (15 | ) | |||||||||
$(15 | ) |
Interest Rate Swap
Notional | Unrealized | |||||||||||||
Pay/Receive | Maturity | Amount | Appreciation | |||||||||||
Floating Rate Reference | Floating Rate | Fixed Rate | Date | Counterparty | (in thousands) | (Depreciation) | ||||||||
6 Month Swiss Franc LIBOR Rate | Receive | 1.000% | June 2024 | Credit Suisse International | 44,760 CHF | $ (2,172 | ) | |||||||
Total Net Unrealized Appreciation (Depreciation) on Swaps | $(15,597 | ) |
(c) | Rounds to less than $1000. |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 123 |
Statements of Assets and Liabilities
As of December 31, 2014 (dollar amounts in thousands)
Large Cap | Large Cap | Mid Cap | ||||||||||||||
Growth | Growth | Value | Growth | |||||||||||||
Fund | Fund | Fund | Fund | |||||||||||||
Assets | ||||||||||||||||
Investments in securities, at cost | $ | 783,619 | $ | 46,320 | $ | 3,634 | $ | 297,145 | ||||||||
Investments in securities, at value | $ | 963,989 | $ | 59,602 | $ | 4,592 | $ | 340,659 | ||||||||
Cash | — | — | 40 | — | ||||||||||||
Receivable for securities sold | — | — | — | 30,327 | ||||||||||||
Receivable for fund shares sold | 1,349 | 47 | 8 | 1,038 | ||||||||||||
Receivable from Adviser | — | 6 | 9 | — | ||||||||||||
Dividend and interest receivable | 327 | 30 | 5 | 61 | ||||||||||||
Total assets | 965,665 | 59,685 | 4,654 | 372,085 | ||||||||||||
Liabilities | ||||||||||||||||
Payable for investment securities purchased | 3,126 | — | — | 504 | ||||||||||||
Payable for fund shares redeemed | 786 | — | — | 31,361 | ||||||||||||
Management fee payable | 614 | 36 | 3 | 308 | ||||||||||||
Distribution fee payable | 58 | 2 | — | 8 | ||||||||||||
Other payables and accrued expenses | 278 | 38 | 30 | 118 | ||||||||||||
Total liabilities | 4,862 | 76 | 33 | 32,299 | ||||||||||||
Net Assets | $ | 960,803 | $ | 59,609 | $ | 4,621 | $ | 339,786 | ||||||||
Capital | ||||||||||||||||
Composition of Net Assets | ||||||||||||||||
Par value of shares of beneficial interest | $ | 68 | $ | 6 | $ | — | $ | 23 | ||||||||
Capital paid in excess of par value | 726,718 | 45,292 | 3,635 | 285,703 | ||||||||||||
Accumulated net investment income (loss) | — | — | — | — | ||||||||||||
Accumulated net realized gain (loss) | 53,647 | 1,029 | 28 | 10,546 | ||||||||||||
Net unrealized appreciation (depreciation) of investments and foreign currencies | 180,370 | 13,282 | 958 | 43,514 | ||||||||||||
Net Assets | $ | 960,803 | $ | 59,609 | $ | 4,621 | $ | 339,786 | ||||||||
Class N Shares | ||||||||||||||||
Net Assets | $ | 272,765 | $ | 8,831 | $ | 1,438 | $ | 37,413 | ||||||||
Shares Outstanding | 20,128,903 | 844,189 | 107,210 | 2,633,996 | ||||||||||||
Net Asset Value Per Share | $ | 13.55 | $ | 10.46 | $ | 13.41 | $ | 14.20 | ||||||||
Class I Shares | ||||||||||||||||
Net Assets | $ | 688,038 | $ | 50,778 | $ | 3,183 | $ | 302,373 | ||||||||
Shares Outstanding | 47,666,756 | 4,684,429 | 237,212 | 20,641,459 | ||||||||||||
Net Asset Value Per Share | $ | 14.43 | $ | 10.84 | $ | 13.42 | $ | 14.65 |
See accompanying Notes to Financial Statements.
124 | Annual Report | December 31, 2014 |
Statements of Operations
For the Year Ended December 31, 2014 (all amounts in thousands)
Large Cap | Large Cap | Mid Cap | ||||||||||||||
Growth | Growth | Value | Growth | |||||||||||||
Fund | Fund | Fund | Fund | |||||||||||||
Investment income | ||||||||||||||||
Dividends | $ | 6,180 | $ | 480 | $ | 87 | $ | 2,198 | ||||||||
Less foreign tax withheld | (24 | ) | — | — | — | |||||||||||
Total income | 6,156 | 480 | 87 | 2,198 | ||||||||||||
Expenses | ||||||||||||||||
Investment advisory fees | 6,905 | 391 | 36 | 3,794 | ||||||||||||
Distribution fees | 698 | 19 | 4 | 97 | ||||||||||||
Custodian fees | 31 | 28 | 29 | 36 | ||||||||||||
Transfer agent fees | 122 | 10 | 3 | 32 | ||||||||||||
Sub-transfer agent fees | ||||||||||||||||
Class N | 374 | 9 | — | 31 | ||||||||||||
Class I | 448 | 29 | — | 315 | ||||||||||||
Professional fees | 88 | 37 | 35 | 66 | ||||||||||||
Registration fees | 30 | 26 | 33 | 35 | ||||||||||||
Shareholder reporting fees | 32 | 4 | — | 55 | ||||||||||||
Trustee fees | 40 | 2 | — | 22 | ||||||||||||
Other expenses | 40 | 6 | 4 | 24 | ||||||||||||
Total expenses before waiver | 8,808 | 561 | 144 | 4,507 | ||||||||||||
Expenses reimbursed to (waived or absorbed by) the Adviser | — | (71 | ) | (98 | ) | (17 | ) | |||||||||
Net expenses | 8,808 | 490 | 46 | 4,490 | ||||||||||||
Net investment income (loss) | (2,652 | ) | (10 | ) | 41 | (2,292 | ) | |||||||||
Realized and unrealized gain (loss) | ||||||||||||||||
Net realized gain (loss) on transactions from: | ||||||||||||||||
Investments in securities | 160,637 | 5,646 | 422 | 48,211 | ||||||||||||
Redemptions in-kind | — | — | — | 6,593 | ||||||||||||
Foreign currency transactions | (2 | ) | — | — | — | |||||||||||
Total net realized gain (loss) | 160,635 | 5,646 | 422 | 54,804 | ||||||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||
Investments in securities | (98,071 | ) | 1,780 | (57 | ) | (23,846 | ) | |||||||||
Change in net unrealized appreciation (depreciation) | (98,071 | ) | 1,780 | (57 | ) | (23,846 | ) | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | 59,912 | $ | 7,416 | $ | 406 | $ | 28,666 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 125 |
Statements of Changes in Net Assets
For the Years Ended December 31, 2014 and 2013 (all amounts in thousands)
Large Cap | Large Cap | Mid Cap | ||||||||||||||||||||||||||||||||||
Growth Fund | Growth Fund | Value Fund | Growth Fund | |||||||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | (2,652 | ) | $ | (2,344 | ) | $ | (10 | ) | $ | (49 | ) | $ | 41 | $ | 32 | $ | (2,292 | ) | $ | (3,157 | ) | ||||||||||||||
Net realized gain (loss) on investments, and other assets and liabilities | 160,635 | 97,323 | 5,646 | 4,446 | 422 | 534 | 54,804 | 79,124 | ||||||||||||||||||||||||||||
Change in net unrealized appreciation (depreciation) on investments, and other assets and liabilities | (98,071 | ) | 154,691 | 1,780 | 5,482 | (57 | ) | 607 | (23,846 | ) | 40,636 | |||||||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 59,912 | 249,670 | 7,416 | 9,879 | 406 | 1,173 | 28,666 | 116,603 | ||||||||||||||||||||||||||||
Distributions to shareholders from | ||||||||||||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||||||||||||
Class N | — | — | — | — | (11 | ) | (8 | ) | — | — | ||||||||||||||||||||||||||
Class I | — | (10 | ) | — | — | (32 | ) | (25 | ) | — | — | |||||||||||||||||||||||||
Net realized gain | ||||||||||||||||||||||||||||||||||||
Class N | (38,561 | ) | (26,967 | ) | (766 | ) | (476 | ) | (127 | ) | (160 | ) | (4,943 | ) | (2,712 | ) | ||||||||||||||||||||
Class I | (92,382 | ) | (53,292 | ) | (4,395 | ) | (2,335 | ) | (281 | ) | (358 | ) | (43,297 | ) | (31,637 | ) | ||||||||||||||||||||
Total distributions | (130,943 | ) | (80,269 | ) | (5,161 | ) | (2,811 | ) | (451 | ) | (551 | ) | (48,240 | ) | (34,349 | ) | ||||||||||||||||||||
Capital stock transactions | ||||||||||||||||||||||||||||||||||||
Net proceeds from sale of shares | 168,221 | 116,328 | 12,804 | 12,160 | 329 | 2,827 | 47,300 | 136,947 | ||||||||||||||||||||||||||||
Shares issued in reinvestment of income dividends and capital gain distributions | 122,205 | 73,656 | 4,464 | 2,623 | 424 | 535 | 46,677 | 33,844 | ||||||||||||||||||||||||||||
Less cost of shares redeemed | (173,143 | ) | (161,079 | ) | (7,105 | ) | (3,073 | ) | (1,194 | ) | (2,722 | ) | (162,245 | ) | (195,652 | ) | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions | 117,283 | 28,905 | 10,163 | 11,710 | (441 | ) | 640 | (68,268 | ) | (24,861 | ) | |||||||||||||||||||||||||
Increase (decrease) in net assets | 46,252 | 198,306 | 12,418 | 18,778 | (486 | ) | 1,262 | (87,842 | ) | 57,393 | ||||||||||||||||||||||||||
Net assets | ||||||||||||||||||||||||||||||||||||
Beginning of period | 914,551 | 716,245 | 47,191 | 28,413 | 5,107 | 3,845 | 427,628 | 370,235 | ||||||||||||||||||||||||||||
End of period | $ | 960,803 | $ | 914,551 | $ | 59,609 | $ | 47,191 | $ | 4,621 | $ | 5,107 | $ | 339,786 | $ | 427,628 | ||||||||||||||||||||
Accumulated net investment income (loss) at the end of the period | $ | — | $ | (4 | ) | $ | — | $ | 2 | $ | — | $ | — | $ | — | $ | — |
See accompanying Notes to Financial Statements.
126 | Annual Report | December 31, 2014 |
Statements of Assets and Liabilities
As of December 31, 2014 (dollar amounts in thousands)
Small-Mid | Small-Mid | |||||||||||||||||
Mid Cap | Cap | Cap | Small Cap | |||||||||||||||
Value | Growth | Value | Growth | |||||||||||||||
Fund | Fund | Fund | Fund | |||||||||||||||
Assets | ||||||||||||||||||
Investments in securities, at cost | $ | 2,639 | $ | 716,665 | $ | 3,751 | $ | 425,814 | ||||||||||
Investments in affiliated companies, at cost | — | — | — | 5,173 | ||||||||||||||
Investments in securities, at value | $ | 3,718 | $ | 885,499 | $ | 4,373 | $ | 507,359 | ||||||||||
Investments in affiliated companies, at value | — | — | — | 6,453 | ||||||||||||||
Cash | 80 | — | — | — | ||||||||||||||
Receivable for securities sold | — | 3,073 | — | 5,402 | ||||||||||||||
Receivable for fund shares sold | 1 | 1,545 | 2 | 736 | ||||||||||||||
Receivable from Adviser | 4 | 42 | 14 | 7 | ||||||||||||||
Dividend and interest receivable | 6 | 290 | 6 | 128 | ||||||||||||||
Total assets | 3,809 | 890,449 | 4,395 | 520,085 | ||||||||||||||
Liabilities | ||||||||||||||||||
Payable for securities purchased | 10 | 1,106 | 8 | 6,361 | ||||||||||||||
Payable for fund shares redeemed | — | 11,544 | 1 | 572 | ||||||||||||||
Management fee payable | 3 | 702 | 4 | 482 | ||||||||||||||
Distribution fee payable | — | 17 | — | 32 | ||||||||||||||
Other payables and accrued expenses | 28 | 244 | 29 | 196 | ||||||||||||||
Total liabilities | 41 | 13,613 | 42 | 7,643 | ||||||||||||||
Net Assets | $ | 3,768 | $ | 876,836 | $ | 4,353 | $ | 512,442 | ||||||||||
Capital | ||||||||||||||||||
Composition of Net Assets | ||||||||||||||||||
Par value of shares of beneficial interest | $ | — | $ | 45 | $ | — | $ | 20 | ||||||||||
Capital paid in excess of par value | 2,686 | 705,514 | 3,648 | 430,086 | ||||||||||||||
Accumulated net investment income (loss) | — | — | — | — | ||||||||||||||
Accumulated net realized gain (loss) | 3 | 2,443 | 83 | (489 | ) | |||||||||||||
Net unrealized appreciation (depreciation) of investments and foreign currencies | 1,079 | 168,834 | 622 | 82,825 | ||||||||||||||
Net Assets | $ | 3,768 | $ | 876,836 | $ | 4,353 | $ | 512,442 | ||||||||||
Class N Shares | ||||||||||||||||||
Net Assets | $ | 189 | $ | 83,047 | $ | 946 | $ | 148,201 | ||||||||||
Shares Outstanding | 14,669 | 4,437,486 | 69,429 | 5,787,345 | ||||||||||||||
Net Asset Value Per Share | $ | 12.88 | $ | 18.72 | $ | 13.63 | $ | 25.61 | ||||||||||
Class I Shares | �� | |||||||||||||||||
Net Assets | $ | 3,579 | $ | 793,789 | $ | 3,407 | $ | 364,241 | ||||||||||
Shares Outstanding | 277,788 | 41,008,827 | 249,833 | 13,331,950 | ||||||||||||||
Net Asset Value Per Share | $ | 12.88 | $ | 19.36 | $ | 13.63 | $ | 27.32 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 127 |
Statements of Operations
For the Year Ended December 31, 2014 (all amounts in thousands)
Small-Mid | Small-Mid | |||||||||||||||||||
Mid Cap | Cap | Cap | Small Cap | |||||||||||||||||
Value | Growth | Value | Growth | |||||||||||||||||
Fund | Fund | Fund | Fund | |||||||||||||||||
Investment income | ||||||||||||||||||||
Dividends | $ | 67 | $ | 5,230 | $ | 47 | $ | 2,802 | ||||||||||||
Less foreign tax withheld | — | (32 | ) | — | (33 | ) | ||||||||||||||
Total income | 67 | 5,198 | 47 | 2,769 | ||||||||||||||||
Expenses | ||||||||||||||||||||
Investment advisory fees | 40 | 7,252 | 32 | 6,109 | ||||||||||||||||
Distribution fees | — | 185 | 2 | 449 | ||||||||||||||||
Custodian fees | 26 | 38 | 32 | 39 | ||||||||||||||||
Transfer agent fees | 1 | 60 | — | 90 | ||||||||||||||||
Sub-transfer agent fees | ||||||||||||||||||||
Class N | 1 | 60 | — | 213 | ||||||||||||||||
Class I | — | 687 | — | 423 | ||||||||||||||||
Professional fees | 31 | 79 | 34 | 73 | ||||||||||||||||
Registration fees | 24 | 37 | 33 | 44 | ||||||||||||||||
Shareholder reporting fees | — | 60 | — | 180 | ||||||||||||||||
Trustee fees | — | 30 | — | 27 | ||||||||||||||||
Other expenses | 7 | 27 | 2 | 27 | ||||||||||||||||
Total expenses before waiver | 130 | 8,515 | 135 | 7,674 | ||||||||||||||||
Expenses reimbursed to (waived or absorbed by) the Adviser | (84 | ) | (352 | ) | (97 | ) | (285 | ) | ||||||||||||
Net expenses | 46 | 8,163 | 38 | 7,389 | ||||||||||||||||
Net investment income (loss) | 21 | (2,965 | ) | 9 | (4,620 | ) | ||||||||||||||
Realized and unrealized gain (loss) | ||||||||||||||||||||
Net realized gain (loss) on transactions from: | ||||||||||||||||||||
Investments in securities | 468 | 67,816 | 361 | 73,574 | (1) | |||||||||||||||
Total net realized gain (loss) | 468 | 67,816 | 361 | 73,574 | ||||||||||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||||||
Investments in securities | (89 | ) | (675 | ) | (182 | ) | (56,321 | )(2) | ||||||||||||
Change in net unrealized appreciation (depreciation) | (89 | ) | (675 | ) | (182 | ) | (56,321 | ) | ||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | 400 | $ | 64,176 | $ | 188 | $ | 12,633 |
(1) Includes $(9,455) from companies deemed affiliated during the year or at December 31, 2014.
(2) Includes $10,479 from companies deemed affiliated during the year or at December 31, 2014.
See accompanying Notes to Financial Statements.
128 | Annual Report | December 31, 2014 |
Statements of Changes in Net Assets
For the Years Ended December 31, 2014 and 2013 (all amounts in thousands)
Mid Cap | Small-Mid | Small-Mid | Small Cap | |||||||||||||||||||||||||||||||||
Value Fund | Cap Growth Fund | Cap Value Fund | Growth Fund | |||||||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | 21 | $ | 25 | $ | (2,965 | ) | $ | (3,376 | ) | $ | 9 | $ | 4 | $ | (4,620 | ) | $ | (3,652 | ) | ||||||||||||||||
Net realized gain (loss) on investments, and other assets and liabilities | 468 | 470 | 67,816 | 49,022 | 361 | 324 | 73,574 | 116,576 | ||||||||||||||||||||||||||||
Change in net unrealized appreciation (depreciation) on investments, and other assets and liabilities | (89 | ) | 694 | (675 | ) | 130,312 | (182 | ) | 560 | (56,321 | ) | 99,236 | ||||||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 400 | 1,189 | 64,176 | 175,958 | 188 | 888 | 12,633 | 212,160 | ||||||||||||||||||||||||||||
Distributions to shareholders from | ||||||||||||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||||||||||||
Class N | (1 | ) | (1 | ) | — | — | — | — | — | — | ||||||||||||||||||||||||||
Class I | (21 | ) | (26 | ) | — | — | (12 | ) | (5 | ) | — | — | ||||||||||||||||||||||||
Net realized gain | ||||||||||||||||||||||||||||||||||||
Class N | (24 | ) | (22 | ) | (6,031 | ) | (4,604 | ) | (76 | ) | (105 | ) | (25,936 | ) | (36,176 | ) | ||||||||||||||||||||
Class I | (471 | ) | (427 | ) | (62,751 | ) | (38,232 | ) | (266 | ) | (173 | ) | (59,140 | ) | (66,355 | ) | ||||||||||||||||||||
Total distributions | (517 | ) | (476 | ) | (68,782 | ) | (42,836 | ) | (354 | ) | (283 | ) | (85,076 | ) | (102,531 | ) | ||||||||||||||||||||
Capital stock transactions | ||||||||||||||||||||||||||||||||||||
Net proceeds from sale of shares | 49 | 248 | 295,395 | 267,012 | 2,169 | 313 | 100,914 | 174,523 | ||||||||||||||||||||||||||||
Shares issued in reinvestment of income dividends and capital gain distributions | 412 | 408 | 66,503 | 41,965 | 214 | 85 | 82,817 | 100,405 | ||||||||||||||||||||||||||||
Less cost of shares redeemed | (1,033 | ) | (1,049 | ) | (171,037 | ) | (142,878 | ) | (1,142 | ) | (117 | ) | (226,205 | ) | (154,011 | ) | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions | (572 | ) | (393 | ) | 190,861 | 166,099 | 1,241 | 281 | (42,474 | ) | 120,917 | |||||||||||||||||||||||||
Increase (decrease) in net assets | (689 | ) | 320 | 186,255 | 299,221 | 1,075 | 886 | (114,917 | ) | 230,546 | ||||||||||||||||||||||||||
Net assets | ||||||||||||||||||||||||||||||||||||
Beginning of period | 4,457 | 4,137 | 690,581 | 391,360 | 3,278 | 2,392 | 627,359 | 396,813 | ||||||||||||||||||||||||||||
End of period | $ | 3,768 | $ | 4,457 | $ | 876,836 | $ | 690,581 | $ | 4,353 | $ | 3,278 | $ | 512,442 | $ | 627,359 | ||||||||||||||||||||
Accumulated net investment income (loss) at the end of the period | $ | — | $ | — | $ | — | $ | — | $ | — | $ — | $ | — | $ | — |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 129 |
Statements of Assets and Liabilities
As of December 31, 2014 (dollar amounts in thousands)
Global | Global Small | International | ||||||||||||||||
Small Cap | Leaders | Cap Growth | Leaders | |||||||||||||||
Value Fund | Fund | Fund | Fund | |||||||||||||||
Assets | ||||||||||||||||||
Investments in securities, at cost | $ | 476,054 | $ | 146,824 | $ | 40,998 | $ | 82,026 | ||||||||||
Investments in securities, at value | $ | 581,571 | $ | 167,908 | $ | 43,101 | $ | 87,885 | ||||||||||
Cash | 23 | — | — | — | ||||||||||||||
Foreign currency, at value (cost $—; $231; $45; $33) | — | 221 | 45 | 33 | ||||||||||||||
Receivable for securities sold | 2,790 | 588 | 12 | 722 | ||||||||||||||
Receivable for fund shares sold | 3,998 | — | 843 | 1 | ||||||||||||||
Receivable from Adviser | 15 | 5 | 14 | 4 | ||||||||||||||
Dividend and interest receivable | 596 | 131 | 29 | 111 | ||||||||||||||
Total assets | 588,993 | 168,853 | 44,044 | 88,756 | ||||||||||||||
Liabilities | ||||||||||||||||||
Payable for investment securities purchased | 2,841 | 4,991 | 777 | 601 | ||||||||||||||
Payable for fund shares redeemed | 275 | 2 | 11 | — | ||||||||||||||
Management fee payable | 537 | 135 | 34 | 73 | ||||||||||||||
Distribution and shareholder administration fees payable | 9 | 8 | 5 | 1 | ||||||||||||||
Foreign tax liability | — | 1 | 37 | 71 | ||||||||||||||
Other payables and accrued expenses | 145 | 54 | 52 | 48 | ||||||||||||||
Total liabilities | 3,807 | 5,191 | 916 | 794 | ||||||||||||||
Net Assets | $ | 585,186 | $ | 163,662 | $ | 43,128 | $ | 87,962 | ||||||||||
Capital | ||||||||||||||||||
Composition of Net Assets | ||||||||||||||||||
Par value of shares of beneficial interest | $ | 32 | $ | 14 | $ | 4 | $ | 7 | ||||||||||
Capital paid in excess of par value | 480,652 | 141,258 | 40,847 | 81,960 | ||||||||||||||
Accumulated net investment income (loss) | — | 6 | (45 | ) | (385 | ) | ||||||||||||
Accumulated net realized gain (loss) | (1,015 | ) | 1,320 | 257 | 601 | |||||||||||||
Net unrealized appreciation (depreciation) of investments and foreign currencies | 105,517 | 21,064 | 2,065 | 5,779 | ||||||||||||||
Net Assets | $ | 585,186 | $ | 163,662 | $ | 43,128 | $ | 87,962 | ||||||||||
Class N Shares | ||||||||||||||||||
Net Assets | $ | 40,223 | $ | 5,007 | $ | 591 | $ | 150 | ||||||||||
Shares Outstanding | 2,265,137 | 422,753 | 48,465 | 12,232 | ||||||||||||||
Net Asset Value Per Share | $ | 17.76 | $ | 11.84 | $ | 12.20 | $ | 12.25 | ||||||||||
Class I Shares | ||||||||||||||||||
Net Assets | $ | 544,963 | $ | 52,090 | $ | 42,537 | $ | 9,561 | ||||||||||
Shares Outstanding | 29,987,940 | 4,395,390 | 3,471,027 | 780,323 | ||||||||||||||
Net Asset Value Per Share | $ | 18.17 | $ | 11.85 | $ | 12.26 | $ | 12.25 | ||||||||||
Institutional Class Shares | ||||||||||||||||||
Net Assets | — | $ | 106,565 | — | $ | 78,251 | ||||||||||||
Shares Outstanding | — | 8,990,390 | — | 6,390,820 | ||||||||||||||
Net Asset Value Per Share | — | $ | 11.85 | — | $ | 12.24 |
See accompanying Notes to Financial Statements.
130 | Annual Report | December 31, 2014 |
Statements of Operations
For the Year Ended December 31, 2014 (all amounts in thousands)
Global | Global Small | International | ||||||||||||||||||
Small Cap | Leaders | Cap Growth | Leaders | |||||||||||||||||
Value Fund | Fund | Fund | Fund | |||||||||||||||||
Investment income | ||||||||||||||||||||
Dividends | $ | 7,613 | $ | 2,646 | $ | 408 | $ | 2,207 | ||||||||||||
Less foreign tax withheld | — | (160 | ) | (30 | ) | (177 | ) | |||||||||||||
Total income | 7,613 | 2,486 | 378 | 2,030 | ||||||||||||||||
Expenses | ||||||||||||||||||||
Investment advisory fees | 6,217 | 1,539 | 309 | 806 | ||||||||||||||||
Distribution fees | 129 | 13 | 1 | — | ||||||||||||||||
Shareholder administration fees | — | 86 | 46 | 17 | ||||||||||||||||
Custodian fees | 38 | 54 | 66 | 53 | ||||||||||||||||
Transfer agent fees | 42 | 13 | 17 | 3 | ||||||||||||||||
Sub-transfer agent fees | ||||||||||||||||||||
Class N | 71 | 5 | — | — | ||||||||||||||||
Class I | 455 | 28 | 7 | — | ||||||||||||||||
Professional fees | 60 | 61 | 57 | 45 | ||||||||||||||||
Registration fees | 34 | 48 | 51 | 48 | ||||||||||||||||
Shareholder reporting fees | 49 | 1 | 1 | — | ||||||||||||||||
Trustee fees | 20 | 6 | 1 | 3 | ||||||||||||||||
Other expenses | 15 | 10 | 5 | 6 | ||||||||||||||||
Total expenses before waiver | 7,130 | 1,864 | 561 | 981 | ||||||||||||||||
Expenses reimbursed to (waived or absorbed by) the Adviser | (36 | ) | (73 | ) | (126 | ) | (73 | ) | ||||||||||||
Net expenses | 7,094 | 1,791 | 435 | 908 | ||||||||||||||||
Net investment income (loss) | 519 | 695 | (57 | ) | 1,122 | |||||||||||||||
Realized and unrealized gain (loss) | ||||||||||||||||||||
Net realized gain (loss) on transactions from: | ||||||||||||||||||||
Investments in securities, net of foreign taxes, if applicable | 16,871 | 7,353 | 1,946 | 1,808 | ||||||||||||||||
Redemptions in-kind | 7,307 | — | — | — | ||||||||||||||||
Foreign currency transactions | — | (39 | ) | (32 | ) | (118 | ) | |||||||||||||
Total net realized gain (loss) | 24,178 | 7,314 | 1,914 | 1,690 | ||||||||||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||||||
Investments in securities | 4,446 | (1,710 | ) | (384 | ) | (4,603 | ) | |||||||||||||
Foreign currency translations | — | 16 | (31 | ) | (84 | ) | ||||||||||||||
Change in net unrealized appreciation (depreciation) | 4,446 | (1,694 | ) | (415 | ) | (4,687 | ) | |||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | 29,143 | $ | 6,315 | $ | 1,442 | $ | (1,875 | ) |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 131 |
Statements of Changes in Net Assets
For the Years Ended December 31, 2014 and 2013 (all amounts in thousands)
Global | ||||||||||||||||||||||||||||||||||||
Small Cap | Global | Small Cap | International | |||||||||||||||||||||||||||||||||
Value Fund | Leaders Fund | Growth Fund | Leaders Fund | |||||||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 (a) | 2014 | 2013 | |||||||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | 519 | $ | (336 | ) | $ | 695 | $ | 429 | $ | (57 | ) | $ | 1 | $ | 1,122 | $ | 718 | ||||||||||||||||||
Net realized gain (loss) on investments, and other assets and liabilities | 24,178 | 30,943 | 7,314 | 8,230 | 1,914 | 440 | 1,690 | (1,137 | ) | |||||||||||||||||||||||||||
Change in net unrealized appreciation (depreciation) on investments, and other assets and liabilities | 4,446 | 71,934 | (1,694 | ) | 14,461 | (415 | ) | 2,480 | (4,687 | ) | 9,754 | |||||||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 29,143 | 102,541 | 6,315 | 23,120 | 1,442 | 2,921 | (1,875 | ) | 9,335 | |||||||||||||||||||||||||||
Distributions to shareholders from | ||||||||||||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||||||||||||
Class N | — | — | — | (8 | ) | — | — | (1 | ) | (2 | ) | |||||||||||||||||||||||||
Class I | (610 | ) | (83 | ) | (75 | ) | (199 | ) | — | (7 | ) | (72 | ) | (195 | ) | |||||||||||||||||||||
Institutional Class | — | — | (301 | ) | (453 | ) | — | — | (746 | ) | (1,054 | ) | ||||||||||||||||||||||||
Net realized gain | ||||||||||||||||||||||||||||||||||||
Class N | (1,435 | ) | (3,772 | ) | (8 | ) | — | (25 | ) | (5 | ) | — | — | |||||||||||||||||||||||
Class I | (18,791 | ) | (23,728 | ) | (85 | ) | — | (1,623 | ) | (426 | ) | — | — | |||||||||||||||||||||||
Institutional Class | — | — | (165 | ) | — | — | — | — | — | |||||||||||||||||||||||||||
Total distributions | (20,836 | ) | (27,583 | ) | (634 | ) | (660 | ) | (1,648 | ) | (438 | ) | (819 | ) | (1,251 | ) | ||||||||||||||||||||
Capital stock transactions | ||||||||||||||||||||||||||||||||||||
Net proceeds from sale of shares | 291,841 | 136,061 | 53,874 | 81,348 | 26,372 | 15,417 | 26,388 | 54,090 | ||||||||||||||||||||||||||||
Shares issued in reinvestment of income dividends and capital gain distributions | 19,104 | 25,084 | 567 | 551 | 576 | 243 | 243 | 544 | ||||||||||||||||||||||||||||
Less cost of shares redeemed | (142,362 | ) | (63,075 | ) | (43,543 | ) | (24,270 | ) | (1,039 | ) | (718 | ) | (4,749 | ) | (4,108 | ) | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions | 168,583 | 98,070 | 10,898 | 57,629 | 25,909 | 14,942 | 21,882 | 50,526 | ||||||||||||||||||||||||||||
Increase (decrease) in net assets | 176,890 | 173,028 | 16,579 | 80,089 | 25,703 | 17,425 | 19,188 | 58,610 | ||||||||||||||||||||||||||||
Net assets | ||||||||||||||||||||||||||||||||||||
Beginning of period | 408,296 | 235,268 | 147,083 | 66,994 | 17,425 | — | 68,774 | 10,164 | ||||||||||||||||||||||||||||
End of period | $ | 585,186 | $ | 408,296 | $ | 163,662 | $ | 147,083 | $ | 43,128 | $ | 17,425 | $ | 87,962 | $ | 68,774 | ||||||||||||||||||||
Accumulated net investment income (loss) at the end of the period | $ | — | $ | 12 | $ | 6 | $ | (274 | ) | $ | (45 | ) | $ | (1 | ) | $ | (385 | ) | $ | (635 | ) |
(a) For the period from April 10, 2013 (Commencement of Operations) to December 31, 2013.
See accompanying Notes to Financial Statements.
132 | Annual Report | December 31, 2014 |
Statements of Assets and Liabilities
As of December 31, 2014 (dollar amounts in thousands)
Institutional | ||||||||||||||||||
Institutional | International | International | ||||||||||||||||
International | International | Growth | Growth | |||||||||||||||
Equity Fund | Equity Fund | Fund | Fund | |||||||||||||||
Assets | ||||||||||||||||||
Investments in securities, at cost | $ | 60,328 | $ | 13,299 | $ | 3,327,015 | $ | 2,127,269 | ||||||||||
Investment in affiliated fund, at cost | — | — | 22,022 | 11,834 | ||||||||||||||
Investments in securities, at value | $ | 66,865 | $ | 14,542 | $ | 3,643,237 | $ | 2,306,677 | ||||||||||
Investment in affiliated fund, at value | — | — | 33,099 | 17,787 | ||||||||||||||
Cash | 3 | 1 | 35 | 22 | ||||||||||||||
Foreign currency, at value (cost $103; $27; $4,639; $2,661) | 100 | 26 | 4,545 | 2,608 | ||||||||||||||
Receivable for securities sold | 1,561 | — | 4,464 | 2,852 | ||||||||||||||
Receivable for fund shares sold | — | — | 7,270 | 13,187 | ||||||||||||||
Receivable from Adviser | 8 | 10 | — | — | ||||||||||||||
Dividend and interest receivable | 137 | 61 | 5,801 | 3,080 | ||||||||||||||
Total assets | 68,674 | 14,640 | 3,698,451 | 2,346,213 | ||||||||||||||
Liabilities | ||||||||||||||||||
Payable for fund shares redeemed | 41 | — | 7,631 | 3,289 | ||||||||||||||
Management fee payable | 62 | 11 | 3,192 | 1,883 | ||||||||||||||
Distribution fee payable | 1 | — | 210 | — | ||||||||||||||
Foreign tax liability | — | — | 2,627 | 1,701 | ||||||||||||||
Other payables and accrued expenses | 61 | 55 | 1,304 | 171 | ||||||||||||||
Total liabilities | 165 | 66 | 14,964 | 7,044 | ||||||||||||||
Net Assets | $ | 68,509 | $ | 14,574 | $ | 3,683,487 | $ | 2,339,169 | ||||||||||
Capital | ||||||||||||||||||
Composition of Net Assets | ||||||||||||||||||
Par value of shares of beneficial interest. | $ | 5 | $ | 1 | $ | 144 | $ | 153 | ||||||||||
Capital paid in excess of par value | 138,333 | 103,932 | 3,710,794 | 2,161,305 | ||||||||||||||
Accumulated net investment income (loss) | 491 | (99 | ) | 22,829 | (9,291 | ) | ||||||||||||
Accumulated net realized gain (loss) | (76,846 | ) | (90,498 | ) | (374,767 | ) | 3,611 | |||||||||||
Net unrealized appreciation (depreciation) of investments and foreign currencies | 6,526 | 1,238 | 324,487 | 183,391 | ||||||||||||||
Net Assets | $ | 68,509 | $ | 14,574 | $ | 3,683,487 | $ | 2,339,169 | ||||||||||
Class N Shares | ||||||||||||||||||
Net Assets | $ | 3,497 | — | $ | 978,433 | — | ||||||||||||
Shares Outstanding | 254,061 | — | 38,759,482 | — | ||||||||||||||
Net Asset Value Per Share | $ | 13.76 | — | $ | 25.24 | — | ||||||||||||
Class I Shares | ||||||||||||||||||
Net Assets | $ | 65,012 | — | $ | 2,705,054 | — | ||||||||||||
Shares Outstanding | 4,672,349 | — | 104,767,380 | — | ||||||||||||||
Net Asset Value Per Share | $ | 13.91 | — | $ | 25.82 | — | ||||||||||||
Institutional Class Shares | ||||||||||||||||||
Net Assets | — | $ | 14,574 | — | $ | 2,339,169 | ||||||||||||
Shares Outstanding | — | 1,212,980 | — | 153,329,207 | ||||||||||||||
Net Asset Value Per Share | — | $ | 12.01 | — | $ | 15.26 |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 133 |
Statements of Operations
For the Year Ended December 31, 2014 (all amounts in thousands)
Institutional | ||||||||||||||||||||
Institutional | International | International | ||||||||||||||||||
International | International | Growth | Growth | |||||||||||||||||
Equity Fund | Equity Fund | Fund | Fund | |||||||||||||||||
Investment income | ||||||||||||||||||||
Dividends | $ | 2,103 | $ | 660 | $ | 109,728 | $ | 63,720 | ||||||||||||
Less foreign tax withheld | (160 | ) | (54 | ) | (8,445 | ) | (4,883 | ) | ||||||||||||
Total income | 1,943 | 606 | 101,283 | 58,837 | ||||||||||||||||
Expenses | ||||||||||||||||||||
Investment advisory fees | 810 | 217 | 40,293 | 22,177 | ||||||||||||||||
Distribution fees | 10 | — | 2,994 | — | ||||||||||||||||
Custodian fees | 48 | 49 | 430 | 285 | ||||||||||||||||
Transfer agent fees | 4 | 1 | 275 | 56 | ||||||||||||||||
Sub-transfer agent fees | ||||||||||||||||||||
Class N | 3 | — | 1,670 | — | ||||||||||||||||
Class I | 63 | — | 2,340 | — | ||||||||||||||||
Professional fees | 63 | 74 | 375 | 270 | ||||||||||||||||
Registration fees | 30 | 21 | 44 | 20 | ||||||||||||||||
Shareholder reporting fees | 2 | — | 416 | 32 | ||||||||||||||||
Trustee fees | 3 | 3 | 184 | 103 | ||||||||||||||||
Other expenses | 8 | 8 | 179 | 98 | ||||||||||||||||
Total expenses before waiver | 1,044 | 373 | 49,200 | 23,041 | ||||||||||||||||
Expenses reimbursed to (waived or absorbed by) the Adviser | (146 | ) | (137 | ) | — | — | ||||||||||||||
Net expenses | 898 | 236 | 49,200 | 23,041 | ||||||||||||||||
Net investment income (loss) | 1,045 | 370 | 52,083 | 35,796 | ||||||||||||||||
Realized and unrealized gain (loss) | ||||||||||||||||||||
Net realized gain (loss) on transactions from: | ||||||||||||||||||||
Investments in securities, net of foreign taxes, if applicable | 6,681 | 18,179 | 404,861 | 202,235 | ||||||||||||||||
Redemptions in-kind | — | — | 16,098 | — | ||||||||||||||||
Foreign currency transactions | (49 | ) | (41 | ) | (4,053 | ) | (2,513 | ) | ||||||||||||
Total net realized gain (loss) | 6,632 | 18,138 | 416,906 | 199,722 | ||||||||||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||||||
Investments in securities | (9,776 | ) | (19,694 | ) | (576,254 | )(1) | (303,548 | )(1) | ||||||||||||
Foreign currency translations | (7 | ) | 4 | (3,216 | ) | (1,252 | ) | |||||||||||||
Change in net unrealized appreciation (depreciation) | (9,783 | ) | (19,690 | ) | (579,470 | ) | (304,800 | ) | ||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | (2,106 | ) | $ | (1,182 | ) | $ | (110,481 | ) | $ | (69,282 | ) |
(1) Includes $7,201 and $3,870 related to an affiliated fund (William Blair China A-Share Fund, LLC) for International Growth Fund and Institutional International Growth Fund, respectively.
See accompanying Notes to Financial Statements.
134 | Annual Report | December 31, 2014 |
Statements of Changes in Net Assets
For the Years Ended December 31, 2014 and 2013 (all amounts in thousands)
International Equity Fund | Institutional International Equity Fund | International Growth Fund | Institutional International Growth Fund | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | 1,045 | $ | 787 | $ | 370 | $ | 1,070 | $ | 52,083 | $ | 53,099 | $ | 35,796 | $ | 34,210 | ||||||||||||||||
Net realized gain (loss) on investments, and other assets and liabilities | 6,632 | 9,011 | 18,138 | 15,673 | 416,906 | 373,514 | 199,722 | 188,259 | ||||||||||||||||||||||||
Change in net unrealized appreciation (depreciation) on investments, and other assets and liabilities | (9,783 | ) | 3,864 | (19,690 | ) | 917 | (579,470 | ) | 268,465 | (304,800 | ) | 158,903 | ||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (2,106 | ) | 13,662 | (1,182 | ) | 17,660 | (110,481 | ) | 695,078 | (69,282 | ) | 381,372 | ||||||||||||||||||||
Distributions to shareholders from | ||||||||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||||||||
Class N | (21 | ) | (34 | ) | — | — | (8,591 | ) | (15,436 | ) | — | — | ||||||||||||||||||||
Class I | (576 | ) | (806 | ) | — | — | (33,318 | ) | (38,834 | ) | — | — | ||||||||||||||||||||
Institutional Class | — | — | (293 | ) | (1,959 | ) | — | — | (44,638 | ) | (40,075 | ) | ||||||||||||||||||||
Net realized gain | ||||||||||||||||||||||||||||||||
Class N | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Class I | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Institutional Class | — | — | — | — | — | — | (189,453 | ) | — | |||||||||||||||||||||||
Total distributions | (597 | ) | (840 | ) | (293 | ) | (1,959 | ) | (41,909 | ) | (54,270 | ) | (234,091 | ) | (40,075 | ) | ||||||||||||||||
Capital stock transactions | ||||||||||||||||||||||||||||||||
Net proceeds from sale of shares | 1,780 | 7,440 | — | 3,200 | 722,959 | 706,104 | 338,472 | 413,943 | ||||||||||||||||||||||||
Shares issued in reinvestment of income dividends and capital gain distributions | 543 | 777 | 293 | 1,959 | 37,862 | 49,456 | 227,055 | 38,132 | ||||||||||||||||||||||||
Less cost of shares redeemed. | (10,689 | ) | (11,645 | ) | (85,049 | ) | (29,745 | ) | (1,220,568 | ) | (773,377 | ) | (363,134 | ) | (327,353 | ) | ||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions. | (8,366 | ) | (3,428 | ) | (84,756 | ) | (24,586 | ) | (459,747 | ) | (17,817 | ) | 202,393 | 124,722 | ||||||||||||||||||
Increase (decrease) in net assets | (11,069 | ) | 9,394 | (86,231 | ) | (8,885 | ) | (612,137 | ) | 622,991 | (100,980 | ) | 466,019 | |||||||||||||||||||
Net assets | ||||||||||||||||||||||||||||||||
Beginning of period | 79,578 | 70,184 | 100,805 | 109,690 | 4,295,624 | 3,672,633 | 2,440,149 | 1,974,130 | ||||||||||||||||||||||||
End of period | $ | 68,509 | $ | 79,578 | $ | 14,574 | $ | 100,805 | $ | 3,683,487 | $ | 4,295,624 | $ | 2,339,169 | $ | 2,440,149 | ||||||||||||||||
Accumulated net investment income (loss) at the end of the period | $ | 491 | $ | 69 | $ | (99 | ) | $ | (714 | ) | $ | 22,829 | $ | 3,511 | $ | (9,291 | ) | $ | (4,220 | ) |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 135 |
Statements of Assets and Liabilities
As of December 31, 2014 (dollar amounts in thousands)
International Small Cap Growth Fund | Emerging Markets Leaders Fund | Emerging Markets Growth Fund | Emerging Markets Small Cap Growth Fund | |||||||||||||
Assets | ||||||||||||||||
Investments in securities, at cost | $ | 590,868 | $ | 103,471 | $ | 909,350 | $ | 221,527 | ||||||||
Investment in affiliated fund, at cost | — | — | 23,624 | — | ||||||||||||
Investments in securities, at value | $ | 619,448 | $ | 106,560 | $ | 960,640 | $ | 254,808 | ||||||||
Investment in affiliated fund, at value | — | — | 35,507 | — | ||||||||||||
Foreign currency, at value (cost $540; $290; $1,436; $1,184) | 538 | 290 | 1,413 | 1,186 | ||||||||||||
Receivable for securities sold | 5,862 | 162 | 1,316 | 2,251 | ||||||||||||
Receivable for fund shares sold | 904 | 71 | 1,068 | 661 | ||||||||||||
Receivable from Adviser | — | 11 | — | 10 | ||||||||||||
Dividend and interest receivable | 1,042 | 40 | 299 | 50 | ||||||||||||
Total assets | 627,794 | 107,134 | 1,000,243 | 258,966 | ||||||||||||
Liabilities | ||||||||||||||||
Payable for investment securities purchased | 2,448 | 617 | 10,821 | 2,232 | ||||||||||||
Payable for fund shares redeemed | 969 | — | 142 | 9 | ||||||||||||
Management fee payable | 560 | 98 | 903 | 235 | ||||||||||||
Distribution and shareholder administration fees payable | 56 | 4 | 26 | 18 | ||||||||||||
Foreign tax liability | 597 | 163 | 2,289 | 2,471 | ||||||||||||
Other payables and accrued expenses | 224 | 70 | 228 | 98 | ||||||||||||
Total liabilities | 4,854 | 952 | 14,409 | 5,063 | ||||||||||||
Net Assets | $ | 622,940 | $ | 106,182 | $ | 985,834 | $ | 253,903 | ||||||||
Capital | ||||||||||||||||
Composition of Net Assets | ||||||||||||||||
Par value of shares of beneficial interest | $ | 49 | $ | 12 | $ | 75 | $ | 15 | ||||||||
Capital paid in excess of par value | 613,903 | 104,315 | 929,633 | 223,569 | ||||||||||||
Accumulated net investment income (loss) | (5,614 | ) | (230 | ) | (3,688 | ) | (1,853 | ) | ||||||||
Accumulated net realized gain (loss) | (13,322 | ) | (839 | ) | (1,021 | ) | 1,344 | |||||||||
Net unrealized appreciation (depreciation) of investments and foreign currencies | 27,924 | 2,924 | 60,835 | 30,828 | ||||||||||||
Net Assets | $ | 622,940 | $ | 106,182 | $ | 985,834 | $ | 253,903 | ||||||||
Class N Shares | ||||||||||||||||
Net Assets | $ | 13,676 | $ | 1,832 | $ | 12,638 | $ | 10,745 | ||||||||
Shares Outstanding | 1,088,567 | 202,139 | 978,959 | 650,777 | ||||||||||||
Net Asset Value Per Share | $ | 12.56 | $ | 9.06 | $ | 12.91 | $ | 16.52 | ||||||||
Class I Shares | ||||||||||||||||
Net Assets | $ | 364,161 | $ | 28,475 | $ | 166,488 | $ | 119,662 | ||||||||
Shares Outstanding | 28,673,236 | 3,137,041 | 12,798,606 | 7,247,394 | ||||||||||||
Net Asset Value Per Share | $ | 12.70 | $ | 9.08 | $ | 13.01 | $ | 16.52 | ||||||||
Institutional Class Shares | ||||||||||||||||
Net Assets | $ | 245,103 | $ | 75,875 | $ | 806,708 | $ | 123,496 | ||||||||
Shares Outstanding | 19,200,404 | 8,363,586 | 61,605,914 | 7,474,184 | ||||||||||||
Net Asset Value Per Share | $ | 12.77 | $ | 9.07 | $ | 13.09 | $ | 16.53 |
See accompanying Notes to Financial Statements.
136 | Annual Report | December 31, 2014 |
Statements of Operations
For the Year Ended December 31, 2014 (all amounts in thousands)
International Small Cap Growth Fund | Emerging Markets Leaders Fund | Emerging Markets Growth Fund | Emerging Markets Small Cap Growth Fund | |||||||||||||
Investment income | ||||||||||||||||
Dividends | $ | 17,303 | $ | 1,772 | $ | 22,773 | $ | 3,603 | ||||||||
Less foreign tax withheld | (1,587 | ) | (131 | ) | (1,818 | ) | (255 | ) | ||||||||
Total income | 15,716 | 1,641 | 20,955 | 3,348 | ||||||||||||
Expenses | ||||||||||||||||
Investment advisory fees | 8,614 | 842 | 10,593 | 2,298 | ||||||||||||
Distribution fees | 41 | 3 | 34 | 29 | ||||||||||||
Shareholder administration fees | 783 | 47 | 267 | 146 | ||||||||||||
Custodian fees | 175 | 102 | 394 | 230 | ||||||||||||
Transfer agent fees | 36 | 13 | 38 | 28 | ||||||||||||
Sub-transfer agent fees | ||||||||||||||||
Class N | 19 | — | 8 | — | ||||||||||||
Class I | 338 | 9 | 109 | — | ||||||||||||
Professional fees | 134 | 77 | 164 | 166 | ||||||||||||
Registration fees | 47 | 43 | 41 | 59 | ||||||||||||
Shareholder reporting fees | 64 | — | 34 | 8 | ||||||||||||
Trustee fees | 41 | 3 | 43 | 7 | ||||||||||||
Other expenses | 40 | 8 | 47 | 8 | ||||||||||||
Total expenses before waiver | 10,332 | 1,147 | 11,772 | 2,979 | ||||||||||||
Expenses reimbursed to (waived or absorbed by) the Adviser | — | (139 | ) | — | (193 | ) | ||||||||||
Net expenses | 10,332 | 1,008 | 11,772 | 2,786 | ||||||||||||
Net investment income (loss) | 5,384 | 633 | 9,183 | 562 | ||||||||||||
Realized and unrealized gain (loss) | ||||||||||||||||
Net realized gain (loss) on transactions from: | ||||||||||||||||
Investments in securities, net of foreign taxes, if applicable | 58,529 | 2,903 | 59,307 | 19,581 | ||||||||||||
Redemptions in-kind | 10,871 | — | — | — | ||||||||||||
Foreign currency transactions | (1,050 | ) | (127 | ) | (1,759 | ) | (504 | ) | ||||||||
Total net realized gain (loss) | 68,350 | 2,776 | 57,548 | 19,077 | ||||||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||
Investments in securities | (142,255 | ) | (3,453 | ) | (37,982 | )(1) | 9,228 | |||||||||
Foreign currency translations | (608 | ) | (64 | ) | 526 | (2,116 | ) | |||||||||
Change in net unrealized appreciation (depreciation) | (142,863 | ) | (3,517 | ) | (37,456 | ) | 7,112 | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | (69,129 | ) | $ | (108 | ) | $ | 29,275 | $ | 26,751 |
(1) | Includes $7,725 related to an affiliated fund (William Blair China A-Share Fund, LLC). |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 137 |
Statements of Changes in Net Assets
For the Years Ended December 31, 2014 and 2013 (all amounts in thousands)
International Small Cap Growth Fund | Emerging Markets Leaders Fund | Emerging Markets Growth Fund | Emerging Markets Small Cap Growth Fund | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | 5,384 | $ | 8,700 | $ | 633 | $ | 415 | $ | 9,183 | $ | 8,023 | $ | 562 | $ | 397 | ||||||||||||||||
Net realized gain (loss) on investments, and other assets and liabilities | 68,350 | 116,911 | 2,776 | 3,320 | 57,548 | 44,441 | 19,077 | (7,991 | ) | |||||||||||||||||||||||
Change in net unrealized appreciation (depreciation) on investments, and other assets and liabilities | (142,863 | ) | 65,024 | (3,517 | ) | (3,693 | ) | (37,456 | ) | (52,993 | ) | 7,112 | 21,903 | |||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (69,129 | ) | 190,635 | (108 | ) | 42 | 29,275 | (529 | ) | 26,751 | 14,309 | |||||||||||||||||||||
Distributions to shareholders from | ||||||||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||||||||
Class N | (164 | ) | (179 | ) | — | (7 | ) | (72 | ) | (7 | ) | (16 | ) | — | ||||||||||||||||||
Class I | (6,193 | ) | (6,074 | ) | (69 | ) | (94 | ) | (1,383 | ) | (550 | ) | (584 | ) | (94 | ) | ||||||||||||||||
Institutional Class | (4,459 | ) | (5,918 | ) | (303 | ) | (162 | ) | (8,124 | ) | (4,674 | ) | (767 | ) | (240 | ) | ||||||||||||||||
Net realized gain | ||||||||||||||||||||||||||||||||
Class N | (1,818 | ) | (746 | ) | (33 | ) | — | (690 | ) | (256 | ) | (433 | ) | (2 | ) | |||||||||||||||||
Class I | (53,418 | ) | (20,094 | ) | (718 | ) | — | (8,947 | ) | (2,796 | ) | (4,971 | ) | (13 | ) | |||||||||||||||||
Institutional Class | (32,680 | ) | (16,732 | ) | (1,894 | ) | — | (41,802 | ) | (14,933 | ) | (5,350 | ) | (21 | ) | |||||||||||||||||
Total distributions | (98,732 | ) | (49,743 | ) | (3,017 | ) | (263 | ) | (61,018 | ) | (23,216 | ) | (12,121 | ) | (370 | ) | ||||||||||||||||
Capital stock transactions | ||||||||||||||||||||||||||||||||
Net proceeds from sale of shares | 158,782 | 147,189 | 57,003 | 24,682 | 196,777 | 285,036 | 96,155 | 151,357 | ||||||||||||||||||||||||
Shares issued in reinvestment of income dividends and capital gain distributions | 83,789 | 44,096 | 2,742 | 237 | 52,055 | 20,187 | 9,684 | 284 | ||||||||||||||||||||||||
Less cost of shares redeemed | (387,962 | ) | (115,493 | ) | (23,496 | ) | (20,619 | ) | (231,277 | ) | (245,693 | ) | (25,665 | ) | (33,502 | ) | ||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions | (145,391 | ) | 75,792 | 36,249 | 4,300 | 17,555 | 59,530 | 80,174 | 118,139 | |||||||||||||||||||||||
Increase (decrease) in net assets | (313,252 | ) | 216,684 | 33,124 | 4,079 | (14,188 | ) | 35,785 | 94,804 | 132,078 | ||||||||||||||||||||||
Net assets | ||||||||||||||||||||||||||||||||
Beginning of period | 936,192 | 719,508 | 73,058 | 68,979 | 1,000,022 | 964,237 | 159,099 | 27,021 | ||||||||||||||||||||||||
End of period | $ | 622,940 | $ | 936,192 | $ | 106,182 | $ | 73,058 | $ | 985,834 | $ | 1,000,022 | $ | 253,903 | $ | 159,099 | ||||||||||||||||
Accumulated net investment income (loss) at the end of the period | $ | (5,614 | ) | $ | (4,067 | ) | $ | (230 | ) | $ | (3 | ) | $ | (3,688 | ) | $ | (1,118 | ) | $ | (1,853 | ) | $ | (214 | ) |
See accompanying Notes to Financial Statements.
138 | Annual Report | December 31, 2014 |
Statements of Assets and Liabilities
As of December 31, 2014 (dollar amounts in thousands)
Bond Fund | Income Fund | Low Duration Fund | Ready Reserves Fund | |||||||||||||
Assets | ||||||||||||||||
Investments in securities, at cost | $ | 247,060 | $ | 96,349 | $ | 167,280 | $ | 1,070,840 | ||||||||
Repurchase agreements, at cost | 5,684 | 786 | 9,920 | 347,790 | ||||||||||||
Investments in securities, at value | $ | 256,060 | $ | 97,352 | $ | 167,002 | $ | 1,070,840 | ||||||||
Repurchase agreements, at value | 5,684 | 786 | 9,920 | 347,790 | ||||||||||||
Cash | — | — | 85 | — | ||||||||||||
Receivable for securities sold | — | — | 10,143 | — | ||||||||||||
Receivable for fund shares sold | 427 | 638 | 497 | — | ||||||||||||
Receivable for variation margin on centrally cleared swaps | 1 | — | — | — | ||||||||||||
Receivable from Adviser | 21 | — | 8 | 656 | ||||||||||||
Dividend and interest receivable | 1,889 | 513 | 440 | 201 | ||||||||||||
Total assets | 264,082 | 99,289 | 188,095 | 1,419,487 | ||||||||||||
Liabilities | ||||||||||||||||
Securities sold, not yet purchased (proceeds $—; $—; $10,143; $—) | — | — | 10,182 | — | ||||||||||||
Payable for investment securities purchased | — | — | 82 | — | ||||||||||||
Payable for fund shares redeemed | 226 | 300 | 164 | — | ||||||||||||
Management fee payable | 68 | 34 | 46 | 287 | ||||||||||||
Distribution, shareholder administration, or service fees payable | 24 | 5 | 15 | 422 | ||||||||||||
Distributions payable to shareholders | 158 | 18 | 57 | — | ||||||||||||
Other payables and accrued expenses | 79 | 78 | 52 | 91 | ||||||||||||
Total liabilities | 555 | 435 | 10,598 | 800 | ||||||||||||
Net Assets | $ | 263,527 | $ | 98,854 | $ | 177,497 | $ | 1,418,687 | ||||||||
Capital | ||||||||||||||||
Composition of Net Assets | ||||||||||||||||
Par value of shares of beneficial interest | $ | 25 | $ | 11 | $ | 19 | $ | 1,418 | ||||||||
Capital paid in excess of par value | 254,544 | 126,893 | 191,746 | 1,417,290 | ||||||||||||
Accumulated net investment income (loss) | 2 | 10 | — | — | ||||||||||||
Accumulated net realized gain (loss) | (27 | ) | (29,063 | ) | (13,951 | ) | (21 | ) | ||||||||
Net unrealized appreciation (depreciation) of investments and foreign currencies | 8,983 | 1,003 | (317 | ) | — | |||||||||||
Net Assets | $ | 263,527 | $ | 98,854 | $ | 177,497 | $ | 1,418,687 | ||||||||
Class N Shares | ||||||||||||||||
Net Assets | $ | 16,720 | $ | 34,020 | $ | 4,969 | $ | 1,418,687 | ||||||||
Shares Outstanding | 1,556,320 | 3,730,756 | 530,023 | 1,418,860,051 | ||||||||||||
Net Asset Value Per Share | $ | 10.74 | $ | 9.12 | $ | 9.38 | $ | 1.00 | ||||||||
Class I Shares | ||||||||||||||||
Net Assets | $ | 149,466 | $ | 64,834 | $ | 104,433 | — | |||||||||
Shares Outstanding | 14,052,229 | 7,161,202 | 11,139,606 | — | ||||||||||||
Net Asset Value Per Share | $ | 10.64 | $ | 9.05 | $ | 9.37 | — | |||||||||
Institutional Class Shares | ||||||||||||||||
Net Assets | $ | 97,341 | — | $ | 68,095 | — | ||||||||||
Shares Outstanding | 9,158,563 | — | 7,262,995 | — | ||||||||||||
Net Asset Value Per Share | $ | 10.63 | — | $ | 9.38 | — |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 139 |
Statements of Operations
For the Year Ended December 31, 2014 (all amounts in thousands)
Bond Fund | Income Fund | Low Duration Fund | Ready Reserves Fund | |||||||||||||||||
Investment income | ||||||||||||||||||||
Interest | $ | 9,232 | $ | 2,846 | $ | 3,064 | $ | 1,097 | ||||||||||||
Total income | 9,232 | 2,846 | 3,064 | 1,097 | ||||||||||||||||
Expenses | ||||||||||||||||||||
Investment advisory fees | 777 | 400 | 487 | 3,259 | ||||||||||||||||
Distribution fees | 19 | 56 | 8 | — | ||||||||||||||||
Shareholder administration fees | 239 | — | 173 | — | ||||||||||||||||
Service fee | — | — | — | 4,778 | ||||||||||||||||
Custodian fees | 57 | 38 | 67 | 74 | ||||||||||||||||
Transfer agent fees | 45 | 20 | 18 | 39 | ||||||||||||||||
Sub-transfer agent fees | ||||||||||||||||||||
Class N | 18 | 45 | 1 | — | ||||||||||||||||
Class I | 59 | 13 | 15 | — | ||||||||||||||||
Professional fees | 92 | 57 | 58 | 119 | ||||||||||||||||
Registration fees | 50 | 30 | 46 | 21 | ||||||||||||||||
Shareholder reporting fees | 13 | 16 | 9 | 61 | ||||||||||||||||
Trustee fees | 11 | 5 | 9 | 61 | ||||||||||||||||
Other expenses | 17 | 11 | 16 | 111 | ||||||||||||||||
Total expenses before waiver | 1,397 | 691 | 907 | 8,523 | ||||||||||||||||
Expenses reimbursed to (waived or absorbed by) the Adviser | (231 | ) | — | (79 | ) | (7,562 | ) | |||||||||||||
Net expenses | 1,166 | 691 | 828 | 961 | ||||||||||||||||
Net investment income (loss) | 8,066 | 2,155 | 2,236 | 136 | ||||||||||||||||
Realized and unrealized gain (loss) | ||||||||||||||||||||
Net realized gain (loss) on transactions from: | ||||||||||||||||||||
Investments in securities | 1,950 | 864 | (351 | ) | — | |||||||||||||||
Securities sold, not yet purchased | — | — | (288 | ) | — | |||||||||||||||
Swaps | (82 | ) | — | — | — | |||||||||||||||
Total net realized gain (loss) | 1,868 | 864 | (639 | ) | — | |||||||||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||||||
Investments in securities | 3,566 | 213 | 582 | — | ||||||||||||||||
Options | (111 | ) | (56 | ) | (111 | ) | — | |||||||||||||
Swaps | (17 | ) | — | — | — | |||||||||||||||
Change in net unrealized appreciation (depreciation) | 3,438 | 157 | 471 | — | ||||||||||||||||
Net increase (decrease) in net assets resulting from operations | $ | 13,372 | $ | 3,176 | $ | 2,068 | $ | 136 |
See accompanying Notes to Financial Statements.
140 | Annual Report | December 31, 2014 |
Statements of Changes in Net Assets
For the Years Ended December 31, 2014 and 2013 (all amounts in thousands)
Bond Fund | Income Fund | Low Duration Fund | Ready Reserves Fund | |||||||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||
Operations | ||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | 8,066 | $ | 8,264 | $ | 2,155 | $ | 2,827 | $ | 2,236 | $ | 3,476 | $ | 136 | $ | 18 | ||||||||||||||||
Net realized gain (loss) on investments, and other assets and liabilities | 1,868 | 3,507 | 864 | 413 | (639 | ) | (2,088 | ) | — | — | ||||||||||||||||||||||
Change in net unrealized appreciation (depreciation) on investments, and other assets and liabilities | 3,438 | (15,868 | ) | 157 | (5,464 | ) | 471 | (3,024 | ) | — | — | |||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 13,372 | (4,097 | ) | 3,176 | (2,224 | ) | 2,068 | (1,636 | ) | 136 | 18 | |||||||||||||||||||||
Distributions to shareholders from | ||||||||||||||||||||||||||||||||
Net investment income | ||||||||||||||||||||||||||||||||
Class N | (463 | ) | (865 | ) | (1,089 | ) | (1,798 | ) | (138 | ) | (249 | ) | (136 | ) | (134 | ) | ||||||||||||||||
Class I | (5,570 | ) | (6,409 | ) | (1,984 | ) | (2,214 | ) | (3,119 | ) | (4,497 | ) | — | — | ||||||||||||||||||
Institutional Class | (3,958 | ) | (3,345 | ) | — | — | (1,371 | ) | (2,780 | ) | — | — | ||||||||||||||||||||
Net realized gain | ||||||||||||||||||||||||||||||||
Class N | — | (126 | ) | — | — | — | — | — | — | |||||||||||||||||||||||
Class I | (3 | ) | (1,556 | ) | — | — | — | — | — | — | ||||||||||||||||||||||
Institutional Class | (2 | ) | (828 | ) | — | — | — | — | — | — | ||||||||||||||||||||||
Total distributions | (9,996 | ) | (13,129 | ) | (3,073 | ) | (4,012 | ) | (4,628 | ) | (7,526 | ) | (136 | ) | (134 | ) | ||||||||||||||||
Capital stock transactions | ||||||||||||||||||||||||||||||||
Net proceeds from sale of shares | 59,547 | 62,355 | 19,953 | 51,821 | 82,798 | 89,150 | 816,738 | 851,400 | ||||||||||||||||||||||||
Shares issued in reinvestment of income dividends and capital gain distributions | 7,797 | 10,140 | 2,700 | 3,452 | 3,419 | 5,747 | 136 | 134 | ||||||||||||||||||||||||
Less cost of shares redeemed | (52,048 | ) | (107,156 | ) | (29,716 | ) | (85,000 | ) | (80,386 | ) | (198,339 | ) | (809,920 | ) | (955,015 | ) | ||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions | 15,296 | (34,661 | ) | (7,063 | ) | (29,727 | ) | 5,831 | (103,442 | ) | 6,954 | (103,481 | ) | |||||||||||||||||||
Increase (decrease) in net assets | 18,672 | (51,887 | ) | (6,960 | ) | (35,963 | ) | 3,271 | (112,604 | ) | 6,954 | (103,597 | ) | |||||||||||||||||||
Net assets | ||||||||||||||||||||||||||||||||
Beginning of period | 244,855 | 296,742 | 105,814 | 141,777 | 174,226 | 286,830 | 1,411,733 | 1,515,330 | ||||||||||||||||||||||||
End of period | $ | 263,527 | $ | 244,855 | $ | 98,854 | $ | 105,814 | $ | 177,497 | $ | 174,226 | $ | 1,418,687 | $ | 1,411,733 | ||||||||||||||||
Accumulated net investment income (loss) at the end of the period | $ | 2 | $ | 3 | $ | 10 | $ | — | $ | — | $ | — | $ | — | $ | — |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 141 |
Statement of Assets and Liabilities
As of December 31, 2014 (dollars amounts in thousands)
Macro Allocation Fund | ||||
Assets | ||||
Investments in securities, at cost | $ | 650,613 | ||
Repurchase agreement, at cost | 299,033 | |||
Investments in securities, at value | $ | 660,155 | ||
Repurchase agreement, at value | 299,033 | |||
Segregated cash at broker | 273 | |||
Due from broker | 2,467 | |||
Foreign currency, at value (cost $379) | 377 | |||
Receivable for fund shares sold | 15,859 | |||
Receivable for futures variation margin | 654 | |||
Receivable for variation margin on centrally cleared swaps | 1 | |||
Receivable from Adviser | 1 | |||
Dividend and interest receivable | 1,313 | |||
Unrealized appreciation on swap contracts | 547 | |||
Net unrealized appreciation on forward foreign currency contracts | 7,200 | |||
Total assets | 987,880 | |||
Liabilities | ||||
Option written, at value (premiums received $820) | 505 | |||
Payable for investment securities purchased | 4,114 | |||
Payable for fund shares redeemed | 3,012 | |||
Payable to custodian | 4,107 | |||
Swap premium received | 364 | |||
Unrealized depreciation on swap contracts | 16,129 | |||
Management fee payable | 636 | |||
Distribution and shareholder administration fees payable | 131 | |||
Other payables and accrued expenses | 196 | |||
Total liabilities | 29,194 | |||
Net Assets | $ | 958,686 | ||
Capital | ||||
Composition of Net Assets | ||||
Par value of shares of beneficial interest | $ | 79 | ||
Capital paid in excess of par value | 974,603 | |||
Accumulated net investment income (loss) | 4,123 | |||
Accumulated realized gain (loss) | (19,250 | ) | ||
Net unrealized appreciation (depreciation) of investments and foreign currencies | (869 | ) | ||
Net Assets | $ | 958,686 | ||
Class N Shares | ||||
Net Assets | $ | 150,778 | ||
Shares Outstanding | 12,423,851 | |||
Net Asset Value Per Share | $ | 12.14 | ||
Class I Shares | ||||
Net Assets | $ | 649,756 | ||
Shares Outstanding | 53,188,480 | |||
Net Asset Value Per Share | $ | 12.22 | ||
Institutional Class Shares | ||||
Net Assets | $ | 158,152 | ||
Shares Outstanding | 12,931,474 | |||
Net Asset Value Per Share | $ | 12.23 |
See accompanying Notes to Financial Statements.
142 | Annual Report | December 31, 2014 |
Statements of Operations
For the Period Ended December 31, 2014 and the Year Ended October 31, 2014 (all amounts in thousands)
Macro Allocation Fund | ||||||||||
Period Ended December 31, 2014 (a) | Year Ended October 31, 2014 | |||||||||
Investment income | ||||||||||
Dividends | $ | 5,349 | $ | 9,463 | ||||||
Less foreign tax withheld | — | (12 | ) | |||||||
Interest | 16 | 83 | ||||||||
Total income | 5,365 | 9,534 | ||||||||
Expenses | ||||||||||
Investment advisory fees | 1,249 | 4,917 | ||||||||
Distribution fees | 63 | 387 | ||||||||
Shareholder administration fees | 195 | 824 | ||||||||
Custodian fees | 16 | 79 | ||||||||
Transfer agent fees | 27 | 172 | ||||||||
Sub-transfer agent fees | ||||||||||
Class N | 37 | 220 | ||||||||
Class I | 43 | 244 | ||||||||
Professional fees | 38 | 252 | ||||||||
Registration fees | 10 | 80 | ||||||||
Shareholder reporting fees | 22 | 173 | ||||||||
Trustee fees | 3 | 17 | ||||||||
Other expenses | 8 | 55 | ||||||||
Short dividend expenses | 51 | 725 | ||||||||
Total expenses before waiver | 1,762 | 8,145 | ||||||||
Expenses reimbursed to (waived or absorbed by) the Advisor | (19 | ) | (380 | ) | ||||||
Net expenses | 1,743 | 7,765 | ||||||||
Net investment income (loss) | 3,622 | 1,769 | ||||||||
Realized and unrealized gain (loss) | ||||||||||
Net realized gain (loss) on transactions from: | ||||||||||
Investments in securities | 4,369 | 10,291 | ||||||||
Securities sold, not yet purchased | (9,445 | ) | — | |||||||
Options | 965 | 3,483 | ||||||||
Futures contracts | (12,404 | ) | (16,220 | ) | ||||||
Swaps | 340 | (610 | ) | |||||||
Forward foreign currency contracts | 32,654 | 12,344 | ||||||||
Foreign currency transactions | (3 | ) | (2 | ) | ||||||
Total net realized gain (loss) | 16,476 | 9,286 | ||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||
Investments in securities | (8,408 | ) | 11,157 | |||||||
Options | (1,741 | ) | 1,382 | |||||||
Futures contracts | 2,711 | (6,499 | ) | |||||||
Swaps | (6,449 | ) | (8,913 | ) | ||||||
Forward foreign currency contracts | (25,008 | ) | 31,116 | |||||||
Foreign currency translations | 57 | (76 | ) | |||||||
Change in net unrealized appreciation (depreciation) | (38,838 | ) | 28,167 | |||||||
Net increase (decrease) in net assets resulting from operations | $ | (18,740 | ) | $ | 39,222 |
(a) | For the period from November 1, 2014 to December 31, 2014. |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 143 |
Statements of Changes in Net Assets
For the Period Ended December 31, 2014 and the Years Ended October 31, 2014 and 2013 (all amounts in thousands)
Macro Allocation Fund | |||||||||||||||
Period Ended December 31, 2014 (a) | Year Ended October 31, 2014 | Year Ended October 31, 2013 | |||||||||||||
Operations | |||||||||||||||
Net investment income (loss) | $ | 3,622 | $ | 1,769 | $ | 751 | |||||||||
Net realized gain (loss) on investments, and other assets and liabilities | 16,476 | 9,286 | 11,431 | ||||||||||||
Change in net unrealized appreciation (depreciation) on investments, and other assets and liabilities | (38,838 | ) | 28,167 | 9,468 | |||||||||||
Net increase (decrease) in net assets resulting from operations | (18,740 | ) | 39,222 | 21,650 | |||||||||||
Distributions to shareholders from | |||||||||||||||
Net investment income | |||||||||||||||
Class N | (7,774 | ) | (868 | ) | (118 | ) | |||||||||
Class I | (32,682 | ) | (1,927 | ) | (307 | ) | |||||||||
Institutional Class | (8,256 | ) | (41 | ) | — | ||||||||||
Net realized gain | |||||||||||||||
Class N | — | (2,106 | ) | (212 | ) | ||||||||||
Class I | — | (4,366 | ) | (524 | ) | ||||||||||
Institutional Class | — | (89 | ) | — | |||||||||||
Total Distributions | (48,712 | ) | (9,397 | ) | (1,161 | ) | |||||||||
Capital stock transactions | |||||||||||||||
Net proceeds from sale of shares | 140,703 | 760,807 | 301,182 | ||||||||||||
Shares issued in reinvestment of income dividends and capital gain distributions | 33,755 | 6,241 | 954 | ||||||||||||
Less cost of shares redeemed | (67,083 | ) | (205,482 | ) | (28,393 | ) | |||||||||
Net increase (decrease) in net assets resulting from capital share transactions | 107,375 | 561,566 | 273,743 | ||||||||||||
Increase (decrease) in net assets | 39,923 | 591,391 | 294,232 | ||||||||||||
Net assets | |||||||||||||||
Beginning of period | 918,763 | 327,372 | 33,140 | ||||||||||||
End of period | $ | 958,686 | $ | 918,763 | $ | 327,372 | |||||||||
Accumulated net investment income (loss) at the end of the period | $ | 4,123 | $ | 17,367 | $ | 3,262 |
(a) | For the period from November 1, 2014 to December 31, 2014. |
See accompanying Notes to Financial Statements.
144 | Annual Report | December 31, 2014 |
(1) Organization
(a) Description of the Trust
William Blair Funds (the “Trust”) is a mutual fund registered under the Investment Company Act of 1940 (the “1940 Act”), as amended, as an open-end management investment company. The Trust currently consists of the following twenty-five funds (the “Funds”), each with its own investment objective and policies. For each Fund, the number of shares authorized is unlimited.
Domestic Equity Funds | International Equity Funds |
Growth | International Leaders |
Large Cap Growth | International Equity |
Large Cap Value | Institutional International Equity |
Mid Cap Growth | International Growth |
Mid Cap Value | Institutional International Growth |
Small-Mid Cap Growth | International Small Cap Growth |
Small-Mid Cap Value | Emerging Markets Leaders |
Small Cap Growth | Emerging Markets Growth |
Small Cap Value | Emerging Markets Small Cap Growth |
Global Equity Funds | Fixed-Income Funds |
Global Leaders | Bond |
Global Small Cap Growth | Income |
Low Duration | |
Multi-Asset and Alternative Fund | |
Macro Allocation | Money Market Fund |
Ready Reserves |
On October 28, 2014, the Board of Trustees approved a change in the Macro Allocation Fund’s fiscal year end from October 31 to December 31. As a result, with respect to the Macro Allocation Fund, this report covers the results of operations for the period from November 1, 2014 to December 31, 2014.
(b) Share Classes
Three different classes of shares currently exist: N, I and Institutional.
Class N shares are offered to the general public, either directly through the Trust’s distributor or through a select number of financial intermediaries. Class N shares are sold without any sales load, and carry an annual 12b-1 distribution fee (0.25% for the Domestic Equity, Global Equity, International Equity and Multi-Asset and Alternative Funds and 0.15% for the Fixed-Income Funds) or a service fee (0.35% for the Money Market Fund), a sub-transfer agent fee that is not a fixed rate and may vary by Fund and class, and an annual shareholder administration fee (0.15% for Global Leaders, Global Small Cap Growth, International Leaders, International Small Cap Growth, Emerging Markets Leaders, Emerging Markets Growth, Emerging Markets Small Cap Growth, Bond, Low Duration and Macro Allocation Funds).
Class I shares are offered to a limited group of investors. They do not carry any sales load or distribution fees and generally have lower ongoing expenses than the Class N shares. Class I shares have a sub-transfer agent fee that is not a fixed rate and may vary by Fund and class and Global Leaders, Global Small Cap Growth, International Leaders, International Small Cap Growth, Emerging Markets Leaders, Emerging Markets Growth, Emerging Markets Small Cap Growth, Bond, Low Duration and Macro Allocation Funds carry an annual shareholder administration fee of 0.15%.
Institutional Class shares are offered to institutional investors, including but not limited to employee benefit plans, endowments, foundations, trusts and corporations, who are able to meet the Fund’s high minimum investment requirement. The minimum initial investment required is $5 million.
December 31, 2014 | William Blair Funds | 145 |
Sub-transfer agent fees: For Class N and Class I shares, the Funds may reimburse William Blair & Company, L.L.C. (“William Blair” or the “Adviser”) for fees paid to intermediaries such as banks, broker-dealers, financial advisors or other financial institutions for sub-transfer agency, sub-administration and other services provided to investors whose shares of record are held in omnibus, other group accounts, retirement plans or accounts traded through registered securities clearing agents. These fees may vary based on, for example, the nature of services provided, but generally range up to 0.15% of the assets of the class serviced or maintained by the intermediary or up to $15 per sub-account maintained by the intermediary.
(c) Fund Objectives
The investment objectives of the Funds are as follows:
Domestic Equity | Long-term capital appreciation. |
Global Equity | Long-term capital appreciation. |
International Equity | Long-term capital appreciation. |
Fixed-Income | High level of current income with relative stability of principal. |
(Maximize total return-Low Duration). | |
Money Market. | Current income, a stable share price and daily liquidity. |
Multi-Asset and Alternative | Maximize long-term risk-adjusted total return |
(2) Significant Accounting Policies
The following is a summary of the Trust’s significant accounting policies in effect during the periods covered by the financial statements, which are in accordance with U.S. generally accepted accounting principles, which includes the accounting and reporting guidelines under Accounting Standards Topic 946, Financial Services—Investment Companies.
(a) Investment income and transactions
Investment income, realized and unrealized gains and losses, and certain Fund level expenses and expense reductions, if any, are allocated based on the relative net assets of each class, except for certain class specific expenses, which are charged directly to the appropriate class. Differences in class expenses may result in the payment of different per share dividends by class. All share classes of the Funds have equal rights with respect to voting, subject to class specific arrangements.
Dividend income and expense are recorded on the ex-dividend date, except for those dividends from certain foreign securities that are recorded when the information is available.
Interest income is recorded on an accrual basis, adjusted for amortization of premium or accretion of discount. Variable rate bonds and floating rate notes earn interest at coupon rates that fluctuate at specific time intervals. The interest rates shown in the Portfolio of Investments for the Bond, Income, Low Duration, Ready Reserves and Macro Allocation Funds were the rates in effect on December 31, 2014. Put bonds may be redeemed at the discretion of the holder on specified dates prior to maturity.
Premiums and discounts are amortized and accreted on a straight-line basis for short-term investments and on an effective interest method for long-term investments.
Paydown gains and losses on mortgage-backed and asset-backed securities are treated as an adjustment to interest income. For the year ended December 31, 2014, the Bond, Income and Low Duration Funds recognized a reduction of interest income and an increase of net realized gain of $1,981, $917 and $2,393, respectively (in thousands). This reclassification had no effect on the net asset value or the net assets of the Funds.
The Funds do not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in value of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments.
Reported net realized foreign currency gains or losses arise from disposition of foreign currency, the difference in the foreign exchange rates between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the ex-date or accrual date and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes (due to the changes in the exchange rate) in the value of foreign currency and other assets and liabilities denominated in foreign currencies held at year end.
146 | Annual Report | December 31, 2014 |
Security and shareholder transactions are accounted for no later than one business day following the trade date. However, for financial reporting purposes, security and shareholder transactions are accounted for on the trade date of the last business day of the reporting period. Realized gains and losses from securities transactions are recognized on a specifically identified cost basis.
Awards from class action litigation may be recorded as a reduction of cost. If the Funds no longer own the applicable securities, the proceeds are recorded as realized gains.
(b) Share Valuation and Distributions to Shareholders
Shares are sold and redeemed on a continuous basis at net asset value. The net asset value per share is determined separately for each class by dividing the Fund’s net assets attributable to that class by the number of shares of the class outstanding as of the close of regular trading on the New York Stock Exchange (the “NYSE”), which is generally 4:00 p.m. Eastern time, on each day the NYSE is open.
Distributions from net investment income, if any, for all Equity and Multi-Asset and Alternative Funds are declared and paid at least annually. Distributions from net investment income for the Bond, Income, Low Duration and Ready Reserves Funds are declared daily and paid monthly. Capital gain distributions, if any for all Funds, are declared and paid at least annually in December. Distributions payable to shareholders are recorded on the ex-dividend date.
(c) Foreign Currency Translation
The Funds may invest in securities denominated in foreign currencies. As such, assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts at the current exchange rate on the date of valuation. The values of foreign investments, open forward foreign currency contracts, and cash denominated in foreign currencies are translated into U.S. dollars using a spot market rate of exchange as of the time of the determination of each Fund’s Net Asset Value, typically 4:00 p.m. Eastern time on days when there is regular trading on the NYSE. Payables and receivables for securities transactions, dividends, interest income and tax reclaims are translated into U.S. dollars using a spot market rate of exchange as of 4:00 p.m. Eastern time. Settlement of purchases and sales and dividend and interest receipts are translated into U.S. dollars using a spot market rate of exchange as of 11:00 a.m. Eastern time.
(d) Income Taxes
Each Fund intends to comply with the provisions of Subchapter M of the Internal Revenue Code available to regulated investment companies. Each Fund intends to make the requisite distributions of income and capital gains to its shareholders sufficient to relieve it from all, or substantially all, federal income and excise taxes. No provision for federal income and excise taxes has been made.
Certain Funds may be subject to foreign income taxes imposed on realized gains on securities of issuers from certain foreign countries. Such taxes, if applicable, are included within net realized gain (loss) on transactions from investments in securities on the Statement of Operations.
Management has evaluated all of the uncertain tax positions of the Funds and has determined that no liability is required to be recorded in the financial statements.
The statute of limitations on the Funds’ tax returns for each of the prior three fiscal years remain open and the returns are subject to examination.
December 31, 2014 | William Blair Funds | 147 |
The Funds have elected to mark-to-market their investments in Passive Foreign Investment Companies (“PFICs”) for federal income tax purposes. The Funds also treat the deferred loss associated with current and prior year wash sales as an adjustment to the cost of investments for tax purposes. The cost of investments for federal income tax purposes and related gross unrealized appreciation (depreciation) and net unrealized appreciation/(depreciation) at December 31, 2014, were as follows (in thousands):
Fund | Cost of Investments | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Net Unrealized Appreciation/ (Depreciation) | ||||||||||||
Growth | $ | 785,206 | $ | 184,860 | $ | 6,077 | $ | 178,783 | ||||||||
Large Cap Growth | 46,466 | 13,540 | 404 | 13,136 | ||||||||||||
Large Cap Value | 3,655 | 986 | 49 | 937 | ||||||||||||
Mid Cap Growth | 298,082 | 52,186 | 9,609 | 42,577 | ||||||||||||
Mid Cap Value | 2,647 | 1,104 | 33 | 1,071 | ||||||||||||
Small-Mid Cap Growth | 718,762 | 177,851 | 11,114 | 166,737 | ||||||||||||
Small-Mid Cap Value | 3,766 | 656 | 49 | 607 | ||||||||||||
Small Cap Growth | 434,673 | 93,031 | 13,892 | 79,139 | ||||||||||||
Small Cap Value | 477,170 | 114,365 | 9,964 | 104,401 | ||||||||||||
Global Leaders | 147,014 | 25,167 | 4,273 | 20,894 | ||||||||||||
Global Small Cap Growth | 41,206 | 3,425 | 1,530 | 1,895 | ||||||||||||
International Leaders | 82,352 | 8,595 | 3,062 | 5,533 | ||||||||||||
International Equity | 60,672 | 8,946 | 2,753 | 6,193 | ||||||||||||
Institutional International Equity | 13,443 | 1,698 | 599 | 1,099 | ||||||||||||
International Growth | 3,372,227 | 461,539 | 157,430 | 304,109 | ||||||||||||
Institutional International Growth | 2,153,747 | 270,637 | 99,920 | 170,717 | ||||||||||||
International Small Cap Growth | 597,450 | 52,562 | 30,564 | 21,998 | ||||||||||||
Emerging Markets Leaders | 104,719 | 6,130 | 4,289 | 1,841 | ||||||||||||
Emerging Markets Growth | 941,849 | 106,215 | 51,917 | 54,298 | ||||||||||||
Emerging Markets Small Cap Growth | 224,366 | 36,207 | 5,765 | 30,442 | ||||||||||||
Bond | 252,744 | 11,147 | 2,147 | 9,000 | ||||||||||||
Income | 97,135 | 1,923 | 920 | 1,003 | ||||||||||||
Low Duration | 177,207 | 963 | 1,248 | (285 | ) | |||||||||||
Ready Reserves | 1,418,630 | — | — | — | ||||||||||||
Macro Allocation | 949,789 | 30,653 | 21,254 | 9,399 |
148 | Annual Report | December 31, 2014 |
In addition, the Funds may periodically record reclassifications among certain capital accounts to reflect differences between financial reporting and income tax basis distributions. The reclassifications were reported in order to reflect the tax treatment for certain permanent differences that exist between income tax regulations and U.S. generally accepted accounting principles. The reclassifications generally relate to net operating losses, Section 988 currency gains and losses, PFIC gains and losses, expiration of capital loss carryforward, paydown gains and losses, and redemptions in-kind. These reclassifications have no impact on the net asset values of the Funds. Accordingly, at December 31, 2014, the following reclassifications were recorded (in thousands):
Fund | Accumulated Undistributed Net Investment Income (Loss) | Accumulated Undistributed Net Realized Gain/(Loss) | Capital Paid in Excess of Par Value | |||||||||
Growth | $ | 2,656 | $ | (2,656 | ) | $ | — | |||||
Large Cap Growth | 8 | (8 | ) | — | ||||||||
Large Cap Value | 2 | (2 | ) | — | ||||||||
Mid Cap Growth | 2,292 | (7,310 | ) | 5,018 | ||||||||
Mid Cap Value | 1 | (1 | ) | — | ||||||||
Small-Mid Cap Growth | 2,965 | (2,965 | ) | — | ||||||||
Small-Mid Cap Value | 3 | (3 | ) | — | ||||||||
Small Cap Growth | 4,620 | — | (4,620 | ) | ||||||||
Small Cap Value | 79 | (7,250 | ) | 7,171 | ||||||||
Global Leaders | (39 | ) | 39 | — | ||||||||
Global Small Cap Growth | 13 | (13 | ) | — | ||||||||
International Leaders | (53 | ) | 53 | — | ||||||||
International Equity | (26 | ) | 26 | — | ||||||||
Institutional International Equity | 538 | (512 | ) | (26 | ) | |||||||
International Growth | 9,144 | (23,789 | ) | 14,645 | ||||||||
Institutional International Growth | 3,771 | (3,771 | ) | — | ||||||||
International Small Cap Growth | 3,885 | (14,305 | ) | 10,420 | ||||||||
Emerging Markets Leaders | (488 | ) | 488 | — | ||||||||
Emerging Markets Growth | (2,174 | ) | 2,174 | — | ||||||||
Emerging Markets Small Cap Growth. | (834 | ) | 834 | — | ||||||||
Bond | 1,924 | (1,924 | ) | — | ||||||||
Income | 928 | 6,608 | (7,536 | ) | ||||||||
Low Duration | 2,392 | (2,393 | ) | 1 | ||||||||
Ready Reserves | — | — | — | |||||||||
Macro Allocation | 31,846 | (31,846 | ) | — |
The timing and characterization of certain income and capital gain distributions are determined annually in accordance with federal income tax regulations that may differ from U.S. generally accepted accounting principles. As a result, net investment income or loss and net realized gain or loss for a reporting period may differ from the amount distributed during such period.
Distributions from net realized gains for book purposes may include short-term capital gains, which are included as ordinary income for tax purposes. The tax character of distributions paid during 2014 and 2013 was as follows (in thousands):
Distributions Paid in 2014 | Distributions Paid in 2013 | |||||||||||||||||||||||||||||||
Ordinary Income | Long-Term Capital Gains | Ordinary Income | Long-Term Capital Gains | |||||||||||||||||||||||||||||
Fund | Class N | Class I | Class N | Class I | Class N | Class I | Class N | Class I | ||||||||||||||||||||||||
Growth | $ | 2,675 | $ | 6,408 | $ | 35,886 | $ | 85,974 | $ | 3,937 | $ | 7,790 | $ | 23,030 | $ | 45,512 | ||||||||||||||||
Large Cap Growth | 60 | 342 | 706 | 4,053 | — | — | 476 | 2,335 | ||||||||||||||||||||||||
Large Cap Value | 19 | 50 | 119 | 263 | 23 | 58 | 145 | 325 | ||||||||||||||||||||||||
Mid Cap Growth | — | — | 4,943 | 43,297 | 347 | 4,052 | 2,365 | 27,585 | ||||||||||||||||||||||||
Mid Cap Value | 2 | 50 | 23 | 442 | 7 | 149 | 16 | 304 | ||||||||||||||||||||||||
Small-Mid Cap Growth | — | — | 6,031 | 62,751 | 877 | 7,283 | 3,727 | 30,949 | ||||||||||||||||||||||||
Small-Mid Cap Value | 12 | 54 | 64 | 224 | 31 | 57 | 74 | 121 | ||||||||||||||||||||||||
Small Cap Growth | 940 | 2,145 | 24,996 | 56,995 | 10,989 | 20,157 | 25,187 | 46,198 | ||||||||||||||||||||||||
Small Cap Value | 34 | 1,020 | 1,401 | 18,381 | 1,034 | 6,584 | 2,738 | 17,227 | ||||||||||||||||||||||||
Global Leaders | — | 75 | 8 | 85 | 8 | 199 | — | — | ||||||||||||||||||||||||
Global Small Cap Growth | 5 | 422 | 19 | 1,202 | 5 | 433 | — | — | ||||||||||||||||||||||||
International Leaders | 1 | 71 | — | 1 | 2 | 195 | — | — | ||||||||||||||||||||||||
International Equity | 21 | 576 | — | — | 34 | 806 | — | — | ||||||||||||||||||||||||
International Growth | 8,591 | 33,318 | — | — | 15,436 | 38,834 | — | — | ||||||||||||||||||||||||
International Small Cap Growth | 153 | 5,751 | 1,829 | 53,860 | 166 | 5,643 | 759 | 20,525 |
December 31, 2014 | William Blair Funds | 149 |
Distributions Paid in 2014 | Distributions Paid in 2013 | |||||||||||||||||||||||||||||||
Ordinary | Long-Term | Ordinary | Long-Term | |||||||||||||||||||||||||||||
Income | Capital Gains | Income | Capital Gains | |||||||||||||||||||||||||||||
Fund | Class N | Class I | Class N | Class I | Class N | Class I | Class N | Class I | ||||||||||||||||||||||||
Emerging Markets Leaders | $ | — | $ | 69 | $ | 33 | $ | 718 | $ | 7 | $ | 94 | $ | — | $ | — | ||||||||||||||||
Emerging Markets Growth | 75 | 1,350 | 688 | 8,980 | 5 | 399 | 258 | 2,947 | ||||||||||||||||||||||||
Emerging Markets Small Cap Growth | 15 | 558 | 434 | 4,997 | — | 94 | 2 | 13 | ||||||||||||||||||||||||
Bond | 463 | 5,570 | — | 3 | 865 | 6,409 | 126 | 1,556 | ||||||||||||||||||||||||
Income | 1,089 | 1,984 | — | — | 1,798 | 2,214 | — | — | ||||||||||||||||||||||||
Low Duration | 138 | 3,119 | — | — | 249 | 4,497 | — | — | ||||||||||||||||||||||||
Ready Reserves | 136 | — | — | — | 134 | — | — | — | ||||||||||||||||||||||||
Macro Allocation | 7,774 | 32,682 | — | — | 2,443 | 5,192 | 531 | 1,102 |
Distributions Paid in 2014 | Distributions Paid in 2013 | |||||||||||||||
Ordinary | Long-Term | Ordinary | Long-Term | |||||||||||||
Income | Capital Gains | Income | Capital Gains | |||||||||||||
Institutional | Institutional | Institutional | Institutional | |||||||||||||
Global Leaders | $ | 301 | 165 | $ | 453 | $ | — | |||||||||
International Leaders | 738 | 8 | 1,054 | — | ||||||||||||
Institutional International Equity | 293 | — | 1,959 | — | ||||||||||||
Institutional International Growth | 47,484 | 186,607 | 40,075 | — | ||||||||||||
International Small Cap Growth | 4,140 | 32,999 | 5,497 | 17,153 | ||||||||||||
Emerging Markets Leaders | 303 | 1,894 | 162 | — | ||||||||||||
Emerging Markets Growth | 7,711 | 42,214 | 3,393 | 16,214 | ||||||||||||
Emerging Markets Small Cap Growth | 732 | 5,385 | 240 | 21 | ||||||||||||
Bond | 3,958 | 2 | 3,345 | 828 | ||||||||||||
Low Duration | 1,371 | — | 2,780 | — | ||||||||||||
Macro Allocation | 8,256 | — | 107 | 22 |
As of December 31, 2014, the components of distributable earnings on a tax basis were as follows (in thousands):
Accumulated | Undistributed | Net Unrealized | ||||||||||||||
Undistributed | Capital and | Long-Term | Appreciation/ | |||||||||||||
Fund | Ordinary Income | Other Losses | Capital Gain | (Depreciation) | ||||||||||||
Growth | $ | 2,225 | $ | — | $ | 53,009 | $ | 178,783 | ||||||||
Large Cap Growth. | 1 | — | 1,174 | 13,136 | ||||||||||||
Large Cap Value | — | (1 | ) | 50 | 937 | |||||||||||
Mid Cap Growth | — | (750 | ) | 12,233 | 42,577 | |||||||||||
Mid Cap Value | — | (19 | ) | 30 | 1,071 | |||||||||||
Small-Mid Cap Growth. | 88 | — | 4,452 | 166,737 | ||||||||||||
Small-Mid Cap Value | — | (12 | ) | 110 | 607 | |||||||||||
Small Cap Growth. | — | — | 3,197 | 79,139 | ||||||||||||
Small Cap Value | — | (1,272 | ) | 1,373 | 104,401 | |||||||||||
Global Leaders | 11 | — | 1,507 | 20,872 | ||||||||||||
Global Small Cap Growth | — | — | 422 | 1,855 | ||||||||||||
International Leaders | — | (111 | ) | 653 | 5,453 | |||||||||||
International Equity | 757 | (76,766 | ) | — | 6,180 | |||||||||||
Institutional International Equity | — | (90,452 | ) | — | 1,093 | |||||||||||
International Growth | 40,106 | (368,856 | ) | — | 301,299 | |||||||||||
Institutional International Growth. | 1,091 | (7,620 | ) | 15,491 | 168,749 | |||||||||||
International Small Cap Growth | — | (12,364 | ) | — | 21,352 | |||||||||||
Emerging Markets Leaders | 8 | — | 170 | 1,677 | ||||||||||||
Emerging Markets Growth | — | (4,959 | ) | 9,132 | 51,953 | |||||||||||
Emerging Markets Small Cap Growth | 1 | — | 2,328 | 27,990 | ||||||||||||
Bond | — | (181 | ) | — | 9,139 | |||||||||||
Income. | 10 | (29,133 | ) | — | 1,073 | |||||||||||
Low Duration | — | (14,085 | ) | — | (183 | ) | ||||||||||
Ready Reserves | — | (21 | ) | — | — | |||||||||||
Macro Allocation | 11,362 | (24,979 | ) | — | (2,379 | ) | ||||||||||
150 | Annual Report | December 31, 2014 |
As of December 31, 2014, the Funds have unused capital loss carryforwards available for federal income tax purposes to be applied against future capital gains, if any. If not applied, the carryforwards will expire as follows (in thousands):
Fund | 2015 | 2016 | 2017 | 2018 | Total | |||||||||||||||
International Equity | $ | — | $ | — | $ | 76,435 | $ | — | $ | 76,435 | ||||||||||
Institutional International Equity | — | — | 90,389 | — | 90,389 | |||||||||||||||
International Growth | — | — | 359,286 | — | 359,286 | |||||||||||||||
Income | 9,190 | 14,459 | 4,577 | — | 28,226 | |||||||||||||||
Low Duration | — | — | — | 955 | 955 | |||||||||||||||
Ready Reserves | 2 | — | — | — | 2 |
Under current law, the Funds may carry forward net capital losses indefinitely to use to offset capital gains realized in future years. Previous law limited the carry forward of capital losses to the eight tax years following the year the capital loss was realized. If a Fund has capital losses that are subject to current law and also has capital losses subject to prior law, the losses realized under current law will be utilized to offset capital gains before any of the losses governed by prior law can be used. As a result of these ordering rules, capital losses realized under previous law may be more likely to expire unused. Capital losses realized under current law will carry forward retaining their classification as long-term or short-term losses; as compared to under prior law in which all capital losses were carried forward as short term capital losses.
As of December 31, 2014, the Funds incurred the following capital losses which will not expire (in thousands):
Short- | Long- | |||||||
Fund | Term | Term | ||||||
Bond | $ | 167 | $ | — | ||||
Income | 246 | 411 | ||||||
Low Duration | 5,999 | 5,615 | ||||||
Ready Reserves | 19 | — | ||||||
Macro Allocation | — | 8,459 |
In order to meet certain excise tax distribution requirements, the Funds are required to measure and distribute annually, net capital gains realized during a twelve month period ending October 31 and net investment income earned during a twelve month period ending December 31. In connection with this, the Funds are permitted for tax purposes to defer into their next fiscal year qualified late year losses. Qualified late year capital losses are any short term or long term capital losses incurred between November 1 and the end of their fiscal year, December 31, 2014. Qualified late year ordinary losses are comprised of losses related to foreign currency and PFICs incurred between November 1 and the end of their fiscal year, December 31, 2014.
As of December 31, 2014, the following Funds deferred, on a tax basis, qualified late year losses of (in thousands):
Qualified Late Year Losses | ||||||||||||
�� | Ordinary | Short-Term | Long-Term | |||||||||
Fund | Income | Capital | Capital | |||||||||
Large Cap Value | $ | — | $ | 1 | $ | — | ||||||
Mid Cap Growth | — | 750 | — | |||||||||
Mid Cap Value | — | 19 | — | |||||||||
Small-Mid Cap Value | — | 12 | — | |||||||||
Small Cap Value. | — | 1,272 | — | |||||||||
International Leaders | 111 | — | — | |||||||||
International Equity | — | 331 | — | |||||||||
Institutional International Equity | 27 | 36 | — | |||||||||
International Growth | — | 9,570 | — | |||||||||
Institutional International Growth | — | 7,620 | — | |||||||||
International Small Cap Growth | 661 | 11,703 | — | |||||||||
Emerging Markets Growth | 1,190 | 3,769 | — | |||||||||
Bond. | 14 | — | — | |||||||||
Income | — | 76 | 174 | |||||||||
Low Duration | — | 1,118 | 398 | |||||||||
Macro Allocation | — | 14,896 | 1,624 |
(e) Repurchase Agreements
In a repurchase agreement, a Fund buys a security at one price and at the time of sale, the seller agrees to repurchase the security at a mutually agreed upon time and price (usually within seven days). The repurchase agreement thereby determines the yield
December 31, 2014 | William Blair Funds | 151 |
during the purchaser’s holding period, while the seller’s obligation to repurchase is secured by the value of the underlying collateral. The Adviser monitors, on an ongoing basis, the value of the underlying collateral to ensure that the value always equals or exceeds the repurchase price plus accrued interest. Repurchase agreements may involve certain risks in the event of a default or insolvency of the other party to the agreement, including possible delays or restrictions upon a Fund’s ability to dispose of the underlying collateral. The risk to a Fund is limited to the ability of the seller to pay the agreed upon sum on the delivery date. In the event of default, a repurchase agreement provides that a Fund is entitled to sell the underlying collateral. The loss, if any, to a Fund will be the difference between the proceeds from the sale and the repurchase price. However, if bankruptcy proceedings are commenced with respect to the seller of the security, disposition of the collateral by the Fund may be delayed or limited. The Funds have master repurchase agreements which allow the Funds to offset amounts owed to a counterparty with amounts owed from the same counterparty, including any collateral, in the event the counterparty defaults. As of December 31, 2014, each Fund’s outstanding repurchase agreements, if any, and related collateral, are shown on the Fund’s Portfolio of Investments. Although no definitive creditworthiness criteria are used, the Adviser reviews the creditworthiness of the banks and non-bank dealers with which a Fund enters into repurchase agreements to evaluate those risks. A Fund may, for tax purposes, deem repurchase agreements collateralized by U.S. Government securities to be investments in U.S. Government securities.
(f) TBA Securities
The Fixed Income Funds may invest in mortgage pass-through securities eligible to be sold in the “to-be announced” market (“TBAs”). TBAs provide for the forward or delayed delivery of the underlying instrument with settlement up to 180 days. The term TBA comes from the fact that the specific mortgage-backed security that will be delivered to fulfill a TBA trade is not designated at the time the trade is made, but rather is generally announced 48 hours before the settlement date. When a Fund sells TBAs, it incurs a risk of loss because it could have to purchase the securities at a price that is higher than the price at which it sold the securities. A Fund generally has the ability to close out a TBA obligation on or before the settlement date, rather than take delivery of the security.
(g) Securities Sold, Not Yet Purchased
Certain Funds may sell a security it does not own in anticipation of a decline in the fair value of that security. When a fund sells a security short, it must borrow the security sold short and deliver it to the broker through which it made the short sale. A gain, limited to the price at which the fund sold the security short, or a loss, unlimited in size, will be recognized upon the termination of the short sale. A fund is also subject to the risk that it may be unable to reacquire a security to terminate a short position except at a price substantially in excess of the price it sold the security short.
(h) Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements. Actual results may differ from those estimates.
(i) Indemnification
In the normal course of business, the Funds have entered into contracts in which the Funds agree to indemnify the other party or parties against various potential costs or liabilities. The Funds’ maximum exposure under these arrangements is unknown. No claim has been made for indemnification pursuant to any such agreement of the Funds.
(j) Redemption In-Kind
In accordance with the Trust’s prospectus, the Funds may distribute portfolio securities rather than cash as payment for a redemption of fund shares (in-kind redemption). For financial reporting purposes, the Fund recognizes a gain or loss on the transfer of securities depending on the value of those securities on the date of redemption. Gains and losses realized on in-kind redemptions may not be recognized for tax purposes and are reclassified from accumulated net realized gain (loss) to capital paid in excess of par value. During the year ended December 31, 2014, the Mid Cap Growth, Small Cap Value, International Growth and International Small Cap Growth Funds redeemed in-kind fund shares with values of $29,821, $20,491, $70,598 and $40,740 (in thousands), respectively, with net realized gains of $6,593, $7,307, $16,098 and $10,871 (in thousands), respectively.
152 | Annual Report | December 31, 2014 |
(3) Valuation
(a) Investment Valuation
The value of domestic equity securities, including exchange-traded funds, is determined by valuing securities traded on national securities markets or in the over-the-counter markets at the last sale price or, if applicable, the official closing price or, in the absence of a recent sale on the date of determination, at the mean between the last reported bid and ask prices.
The value of foreign equity securities is generally determined based upon the last sale price on the foreign exchange or market on which it is primarily traded and in the currency of that market as of the close of the appropriate exchange or, if there have been no sales during that day, at the mean between the last reported bid and ask prices. The Board of Trustees has determined that the passage of time between when the foreign exchanges or markets close and when the Funds compute their net asset values could cause the value of foreign equity securities to no longer be representative or accurate and, as a result, may necessitate that such securities be fair valued. Accordingly, for foreign equity securities, the Funds may use an independent pricing service to fair value price the security as of the close of regular trading on the NYSE. As a result, a Fund’s value for a security may be different from the last sale price (or the mean between the last reported bid and ask prices).
Fixed-income securities are generally valued using evaluated prices provided by an independent pricing service. The evaluated prices are formed using various market inputs that the pricing service believes accurately represent the market value of a security at a particular point in time. The pricing service determines evaluated prices for fixed-income securities using inputs including, but not limited to, recent transaction prices, dealer quotes, transaction prices for securities with similar characteristics, collateral characteristics, credit quality, payment history, liquidity and market conditions.
Repurchase agreements are valued at cost, which approximates fair value.
Option contracts on securities, currencies and other financial instruments traded on one or more exchanges are valued at their most recent sale price on the exchange on which they are traded most extensively. Futures contracts (and options and swaps thereon) are valued at the most recent settlement price on the exchange on which they are traded most extensively. Forward foreign currency contracts are valued on the basis of the value of the underlying currencies at the prevailing currency exchange rate as supplied by an independent pricing service.
Over-the-Counter (“OTC”) swap contracts are valued by an independent pricing service. Depending on the product and the terms of the transaction, the independent pricing service may use a series of techniques, including simulation pricing models. The pricing models use inputs that are observed from actively quoted markets such as issuer details, indices, spreads, interest rates, yield curves, dividends and exchange rates.
Centrally cleared swaps listed or settled on a multilateral or trade facility platform, such as a registered exchange, are valued at the daily settlement price determined by the respective exchange. For centrally cleared credit default swaps the clearing facility requires its members to provide actionable price levels across complete term structures. These levels along with external third-party prices are used to produce daily settlement prices.
Investments in other investment funds that are not exchange-traded funds are valued at the underlying fund’s ending net asset value on the date of valuation.
Securities held in the Ready Reserves Fund are valued at amortized cost, which approximates fair value.
Securities, and other assets, for which a market price is not available or is deemed unreliable (e.g., securities affected by unusual or extraordinary events, such as natural disasters or securities affected by market or economic events, such as bankruptcy filings), or the value of which is affected by a significant valuation event, are valued at a fair value as determined in good faith by, or under the direction of, the Board of Trustees and in accordance with the Valuation Procedures approved by the Board of Trustees. The value of fair valued securities may be different from the last sale price (or the mean between the last reported bid and ask prices), and there is no guarantee that a fair valued security will be sold at the price at which a Fund is carrying the security.
As of December 31, 2014, there were securities held in the International Growth and Institutional International Growth Funds requiring fair valuation pursuant to the Trust’s Valuation Procedures.
(b) Fair Value Measurements
Fair value is defined as the price that a Fund would receive upon selling a security in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment. Various inputs are used in determining the value of a
December 31, 2014 | William Blair Funds | 153 |
Fund’s investments. A three-tier hierarchy of inputs is used to classify fair value measurements for disclosure purposes. The three-tier hierarchy of inputs is summarized in the three broad levels listed below:
• | Level 1—Quoted prices (unadjusted) in active markets for an identical security. | |
• | Level 2—Prices determined using other significant observable inputs. Observable inputs are inputs that other market participants would use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, and others. In addition, other observable inputs such as foreign exchange rates, benchmark securities indices and foreign futures contracts may be utilized in the valuation of certain foreign securities when significant events occur between the last sale on the foreign securities exchange and the time the net asset value of the Fund is calculated. | |
• | Level 3—Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment), unobservable inputs may be used. Unobservable inputs reflect the Fund’s own assumptions about the factors market participants would use in pricing an investment, and would be based on the best information available. |
The inputs or methodology used for valuing an investment are not necessarily an indication of the risk associated with investing in those securities. For example, money market securities are valued using amortized cost, in accordance with rules under the 1940 Act. Generally, amortized cost approximates the current fair value of a security, but since the value is not obtained from a quoted price in an active market, such securities are reflected as Level 2.
A description of the valuation technique applied to the Fund’s major categories of assets and liabilities measured at fair value on a recurring basis as follows:
Exchange-Traded Securities
Securities traded on a national securities exchange (or reported on the NASDAQ national market), including exchange-traded funds, are stated at the last reported sales price on the day of valuation. Other securities traded in the over-the-counter market and listed securities for which no sale was reported on that date are stated at the mean between the last reported bid and ask prices. To the extent these securities are actively traded and valuation adjustments are not applied, they are categorized in Level 1 of the fair value hierarchy.
Fixed-Income Securities
Fixed-income securities including corporate, convertible and municipal bonds and notes, U.S. government agencies, U.S. treasury obligations, sovereign issues, bank loans, convertible preferred securities and non-U.S. bonds are generally valued using evaluated prices provided by an independent pricing service. The evaluated prices are formed using various market inputs that the pricing service believes accurately represent the fair value of a security at a particular point in time. The pricing service determines evaluated prices for fixed-income securities using inputs including, but not limited to, recent transaction prices, dealer quotes, transaction prices for securities with similar characteristics, collateral characteristics, credit quality, payment history, liquidity and market conditions. Securities that use similar valuation techniques and observable inputs as described above are categorized as Level 2 of the fair value hierarchy.
Short-Term Investments
Short-term investments in the Ready Reserves Fund are valued at amortized cost, which approximates fair value. Repurchase agreements are valued at cost, which approximates fair value. These investments are categorized as Level 2 of the fair value hierarchy.
Derivative Instruments
Listed derivatives, such as certain options and futures contracts, that are actively traded are valued based on quoted prices from the exchange on which they are traded most extensively and are categorized in Level 1 of the fair value hierarchy. OTC derivative contracts include forward foreign currency contracts, swap and certain option contracts related to interest rates, foreign currencies, credit standing of reference entities, equity prices, or commodity prices. Depending on the product and the terms of the transaction, the fair value of OTC derivative products can be modeled taking into account the counterparties’ creditworthiness and using a series of techniques, including simulation models. Many pricing models do not entail material subjectivity because the methodologies employed do not necessitate significant judgments and the pricing inputs are observed from actively quoted markets, as is the case of forward foreign currency contracts and interest rate swaps. A substantial majority of OTC derivative products valued by a Fund using pricing models fall into this category and are categorized within Level 2 of the fair value hierarchy.
Any transfers between Level 1 and Level 2 are disclosed, effective as of the beginning of the year, in the following tables with the reasons for the transfers disclosed in a note to the tables, if applicable. Transfer amounts are based on end of year values.
154 | Annual Report | December 31, 2014 |
As of December 31, 2014, the hierarchical input levels of securities in each Fund, segregated by security class or other financial instruments, are as follows (in thousands):
Investments in securities | Growth | Large Cap Growth | Large Cap Value | Mid Cap Growth | Mid Cap Value | |||||||||||
Level 1—Quoted prices | ||||||||||||||||
Common Stocks | $ | 952,482 | $ | 58,988 | $ | 4,592 | $ | 328,976 | $ | 3,718 | ||||||
Level 2—Other significant observable inputs | ||||||||||||||||
Short-Term Investments | 11,507 | 614 | — | 11,683 | — | |||||||||||
Level 3—Significant unobservable inputs | ||||||||||||||||
None | — | — | — | — | — | |||||||||||
Total investments in securities | $ | 963,989 | $ | 59,602 | $ | 4,592 | $ | 340,659 | $ | 3,718 |
Investments in securities | Small-Mid Cap Growth | Small-Mid Cap Value | Small Cap Growth | Small Cap Value | |||||||||
Level 1—Quoted prices | |||||||||||||
Common Stocks | $ | 871,390 | $ | 4,338 | $ | 497,024 | $ | 576,922 | |||||
Exchange-Traded Fund | — | — | 3,793 | — | |||||||||
Level 2—Other significant observable inputs | |||||||||||||
Short-Term Investments | 14,109 | 35 | 12,995 | 4,649 | |||||||||
Level 3—Significant unobservable inputs | |||||||||||||
None | — | — | — | — | |||||||||
Total investments in securities | $ | 885,499 | $ | 4,373 | $ | 513,812 | $ | 581,571 |
Investments in securities | Global Leaders | Global Small Cap Growth | International Leaders | International Equity | Institutional International Equity | International Growth | ||||||||||||||||||
Level 1—Quoted prices | ||||||||||||||||||||||||
Common Stocks | $ | 95,441 | $ | 21,537 | $ | 17,538 | $ | 9,238 | $ | 1,963 | $ | 465,863 | ||||||||||||
Rights | — | — | — | — | — | 992 | ||||||||||||||||||
Level 2—Other significant observable inputs | ||||||||||||||||||||||||
Affiliated Fund | — | — | — | — | — | 33,099 | ||||||||||||||||||
Common Stocks | 64,582 | 20,376 | 69,297 | 57,466 | 12,222 | 3,094,543 | ||||||||||||||||||
Preferred Stock | — | — | — | — | — | 12,577 | ||||||||||||||||||
Short-Term Investments | 7,885 | 1,188 | 1,050 | 161 | 357 | 69,228 | ||||||||||||||||||
Level 3—Significant unobservable inputs | ||||||||||||||||||||||||
Common Stocks | — | — | — | — | — | 34 | ||||||||||||||||||
Total investments in securities | $ | 167,908 | $ | 43,101 | $ | 87,885 | $ | 66,865 | $ | 14,542 | $ | 3,676,336 | ||||||||||||
Level 1 and Level 2 transfers | ||||||||||||||||||||||||
Transfers from Level 1 to Level 2 (a) | $ | 39,837 | $ | 7,633 | $ | 36,022 | $ | 36,904 | $ | 7,859 | $ | 1,870,148 | ||||||||||||
Transfers from Level 2 to Level 1 | — | — | — | — | — | — |
Investments in securities | Institutional International Growth | International Small Cap Growth | Emerging Markets Leaders | Emerging Markets Growth | Emerging Markets Small Cap Growth | |||||||||||||||
Level 1—Quoted prices | ||||||||||||||||||||
Common Stocks | $ | 296,160 | $ | 85,008 | $ | 22,851 | $ | 188,667 | $ | 29,810 | ||||||||||
Rights | 635 | — | — | — | — | |||||||||||||||
Warrants | — | 1 | — | — | 1 | |||||||||||||||
Level 2—Other significant observable inputs | ||||||||||||||||||||
Affiliated Fund | 17,787 | — | — | 35,507 | — | |||||||||||||||
Common Stocks | 1,968,096 | 531,544 | 79,617 | 733,518 | 222,485 | |||||||||||||||
Preferred Stocks | 7,891 | — | 1,883 | 13,911 | — | |||||||||||||||
Short-Term Investments | 33,878 | 2,895 | 2,209 | 24,544 | 2,512 | |||||||||||||||
Level 3—Significant unobservable inputs | ||||||||||||||||||||
Common Stocks | 17 | — | — | — | — | |||||||||||||||
Total investments in securities | $ | 2,324,464 | $ | 619,448 | $ | 106,560 | $ | 996,147 | $ | 254,808 | ||||||||||
Level 1 and Level 2 transfers | ||||||||||||||||||||
Transfers from Level 1 to Level 2 (a) | $ | 1,193,095 | $ | 234,794 | $ | 39,020 | $ | 400,489 | $ | 85,541 | ||||||||||
Transfers from Level 2 to Level 1 | — | — | — | — | — |
December 31, 2014 | William Blair Funds | 155 |
Investments in securities | Bond | Income | Low Duration | Ready Reserves | Macro Allocation | |||||||||||||||
Assets | ||||||||||||||||||||
Level 1—Quoted Prices | ||||||||||||||||||||
Exchange-Traded Funds | $ | — | $ | — | $ | — | $ | — | $ | 555,724 | ||||||||||
Purchased Options | 73 | 37 | 73 | — | 6,569 | |||||||||||||||
Level 2—Other significant observable inputs | ||||||||||||||||||||
Asset-Backed Securities | 13,590 | 9,488 | 41,933 | — | — | |||||||||||||||
Commercial Paper | — | — | — | 907,304 | — | |||||||||||||||
Common Stock | — | — | — | — | 4,953 | |||||||||||||||
Corporate Obligation/Notes | 119,848 | 32,852 | 23,347 | 37,507 | — | |||||||||||||||
Purchased Option | — | — | — | — | 957 | |||||||||||||||
Short-Term Investments | 5,684 | 786 | 9,920 | 347,790 | 299,033 | |||||||||||||||
U.S. Government and U.S. Government Agency | 122,549 | 54,975 | 101,649 | 126,029 | 91,952 | |||||||||||||||
Level 3—Significant unobservable inputs | ||||||||||||||||||||
None | — | — | — | — | — | |||||||||||||||
Liabilities | ||||||||||||||||||||
Level 1—Quoted Prices | ||||||||||||||||||||
Written Options | — | — | — | — | (505 | ) | ||||||||||||||
Level 2—Other significant observable inputs | ||||||||||||||||||||
None | — | — | — | — | — | |||||||||||||||
Level 3—Significant unobservable inputs | ||||||||||||||||||||
None | — | — | — | — | — | |||||||||||||||
Total investments in securities | $ | 261,744 | $ | 98,138 | $ | 176,922 | $ | 1,418,630 | $ | 958,683 | ||||||||||
Other financial instruments | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Level 1—Quoted Prices | ||||||||||||||||||||
Futures Contracts | $ | — | $ | — | $ | — | $ | — | $ | 10,032 | ||||||||||
Level 2—Other significant observable inputs | ||||||||||||||||||||
Forward Foreign Currency Contracts | — | — | — | — | 17,571 | |||||||||||||||
Futures Contracts | — | — | — | — | 19 | |||||||||||||||
Swaps | — | — | — | — | 547 | |||||||||||||||
Level 3—Significant unobservable inputs | ||||||||||||||||||||
None | — | — | — | — | — | |||||||||||||||
Liabilities | ||||||||||||||||||||
Level 1—Quoted Prices | ||||||||||||||||||||
Futures Contracts | — | — | — | — | (11,235 | ) | ||||||||||||||
Level 2—Other significant observable inputs | ||||||||||||||||||||
Forward Foreign Currency Contracts | — | — | — | — | (10,371 | ) | ||||||||||||||
Futures Contracts | — | — | — | — | (1,141 | ) | ||||||||||||||
Swaps | (17 | ) | — | — | — | (16,144 | ) | |||||||||||||
U.S. Government and U.S. Government Agency | — | — | (10,182 | ) | — | — | ||||||||||||||
Level 3—Significant unobservable inputs | ||||||||||||||||||||
None | — | — | — | — | — | |||||||||||||||
Total other financial instruments | $ | (17 | ) | $ | — | $ | (10,182 | ) | $ | — | $ | (10,722 | ) |
(a) | Fair valuation estimates were obtained from the Funds’ pricing vendor and applied to certain foreign securities at December 31, 2014, but not at December 31, 2013. |
Level 1 Common Stocks are exchange-traded securities with a quoted price. See Portfolio of Investments for Sector Classification.
The fair value estimates for the Level 3 securities in the International Growth and Institutional International Growth Funds were determined in good faith by the Pricing Committee, pursuant to the Valuation Procedures adopted by the Board of Trustees. There were various factors considered in reaching this fair value determination, including, but not limited to, the following: the type of security, the extent of public trading of the security, information obtained from a broker-dealer for the security, analysis of the company’s performance, market trends that influence its performance and the potential for an adverse outcome in pending litigation. Level 3 securities represented 0.00% and 0.00% as a percentage of net assets in the International Growth and Institutional International Growth Funds, respectively. The change in net unrealized gain (loss) related to those securities held at December 31, 2014 is included in the change in net unrealized appreciation (depreciation) of investments on the Statements of Operations.
156 | Annual Report | December 31, 2014 |
(4) Transactions with Affiliates
(a) Management and Expense Limitation Agreements
Each Fund has a management agreement with the Adviser for investment management, clerical, bookkeeping and administrative services. Each Fund pays the Adviser an annual fee, payable monthly, based on a specified percentage of its average daily net assets. A summary of the annual rates expressed as a percentage of average daily net assets is as follows:
Domestic Equity Funds | ||||
Growth | 0.75 | % | ||
Large Cap Growth1 | 0.70 | % | ||
Large Cap Value2 | 0.70 | % | ||
Mid Cap Growth | 0.95 | % | ||
Mid Cap Value | 0.95 | % | ||
Small-Mid Cap Growth | 1.00 | % | ||
Small-Mid Cap Value | 1.00 | % | ||
Small Cap Growth | 1.10 | % | ||
Small Cap Value | 1.10 | % | ||
Fixed-Income Funds | ||||
Bond | 0.30 | % | ||
Income5: | ||||
First $250 million | 0.25 | % | ||
In excess of $250 million | 0.20 | % | ||
Low Duration | 0.30 | % | ||
Money Market Fund | ||||
Ready Reserves: | ||||
First $250 million | 0.275 | % | ||
Next $250 million | 0.25 | % | ||
Next $2 billion | 0.225 | % | ||
In excess of $2.5 billion | 0.20 | % | ||
Multi-Asset and Alternative Fund | ||||
Macro Allocation | 0.80 | % |
Global Equity Funds | ||||
Global Leaders | 1.00 | % | ||
Global Small Cap Growth | 1.00 | % | ||
International Equity Funds | ||||
International Leaders | 0.95 | % | ||
International Equity3: | ||||
First $250 million | 1.00 | % | ||
In excess of $250 million | 0.90 | % | ||
Institutional International Equity4: | ||||
First $500 million | 0.90 | % | ||
Next $500 million | 0.85 | % | ||
In excess of $1 billion | 0.80 | % | ||
International Growth: | ||||
First $250 million | 1.10 | % | ||
Next $4.75 billion | 1.00 | % | ||
Next $5 billion | 0.95 | % | ||
Next $5 billion | 0.925 | % | ||
In excess of $15 billion | 0.90 | % | ||
Institutional International Growth: | ||||
First $500 million | 1.00 | % | ||
Next $500 million | 0.95 | % | ||
Next $1.5 billion | 0.90 | % | ||
Next $2.5 billion | 0.875 | % | ||
Next $5 billion | 0.85 | % | ||
Next $5 billion | 0.825 | % | ||
In excess of $15 billion | 0.80 | % | ||
International Small Cap Growth | 1.00 | % | ||
Emerging Markets Leaders | 1.10 | % | ||
Emerging Markets Growth | 1.10 | % | ||
Emerging Markets Small Cap Growth | 1.10 | % |
1 | Effective May 1, 2014, the management fee to be paid to the Adviser by the Large Cap Growth Fund was reduced to 0.70% from 0.80% of average daily net assets. |
2 | Effective May 1, 2014, the management fee to be paid to the Adviser by the Large Cap Value Fund was reduced to 0.70% from 0.80% of average daily net assets. |
3 | Effective May 1, 2014, the management fee to be paid to the Adviser by the International Equity Fund was reduced to 1.00% of the first $250 million of average daily net assets, plus 0.90% of average daily net assets over $250 million from 1.10% of the first $250 million of average daily net assets, plus 1.00% of average daily net assets over $250 million. |
4 | Effective May 1, 2014, the management fee to be paid to the Adviser by Institutional International Equity Fund was reduced to 0.90% of the first $500 million of average daily net assets, plus 0.85% of the next $500 million of average daily net assets, plus 0.80% of average daily net assets over $1 billion from 1.00% of the first $500 million of average daily net assets, plus 0.95% of the next $500 million of average daily net assets, plus 0.90% of average daily net assets over $1 billion. |
5 | Management fee also includes a charge of 5% of gross income. |
December 31, 2014 | William Blair Funds | 157 |
Some of the Funds have also entered into an Amended and Restated Expense Limitation Agreement with the Adviser. Under the terms of the agreement, the Adviser will waive its management fee and/or reimburse the Fund for expenses in excess of the agreed upon rate. The amount the Adviser owes a Fund as of the reporting date is recorded as Receivable from Adviser on the Statements of Assets and Liabilities. The Adviser reimburses the Funds on a monthly basis. Under the terms of the agreement, the Adviser has agreed to waive its management fees and/or absorb other operating expenses through April 30, 2015 (February 28, 2015 for Macro Allocation), if total expenses for each class of the following Funds exceed the following rates (as a percentage of average daily net assets):
Class N | Class I | Institutional Class | ||||||||||||||||||||||
Fund | Effective May 1, 2014 through April 30, 2015 | Effective May 1, 2013 through April 30, 2014 | Effective May 1, 2014 through April 30, 2015 | Effective May 1, 2013 through April 30, 2014 | Effective May 1, 2014 through April 30, 2015 | Effective May 1, 2013 through April 30, 2014 | ||||||||||||||||||
Growth | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
Large Cap Growth | 1.10 | % | 1.20 | % | 0.85 | % | 0.95 | % | N/A | N/A | ||||||||||||||
Large Cap Value | 1.10 | % | 1.20 | % | 0.85 | % | 0.95 | % | N/A | N/A | ||||||||||||||
Mid Cap Growth | 1.35 | % | 1.35 | % | 1.10 | % | 1.10 | % | N/A | N/A | ||||||||||||||
Mid Cap Value | 1.35 | % | 1.35 | % | 1.10 | % | 1.10 | % | N/A | N/A | ||||||||||||||
Small-Mid Cap Growth | 1.35 | % | 1.35 | % | 1.10 | % | 1.10 | % | N/A | N/A | ||||||||||||||
Small-Mid Cap Value | 1.40 | % | 1.40 | % | 1.15 | % | 1.15 | % | N/A | N/A | ||||||||||||||
Small Cap Growth | 1.50 | % | 1.50 | % | 1.25 | % | 1.25 | % | N/A | N/A | ||||||||||||||
Small Cap Value | 1.50 | % | 1.50 | % | 1.25 | % | 1.25 | % | N/A | N/A | ||||||||||||||
Global Leaders | 1.50 | % | 1.50 | % | 1.25 | % | 1.25 | % | 1.10 | % | 1.10 | % | ||||||||||||
Global Small Cap Growth | 1.65 | % | 1.65 | %(a) | 1.40 | % | 1.40 | %(a) | 1.25 | % | 1.25 | %(a) | ||||||||||||
International Leaders | 1.45 | % | 1.45 | % | 1.20 | % | 1.20 | % | 1.05 | % | 1.05 | % | ||||||||||||
International Equity | 1.35 | % | 1.45 | % | 1.10 | % | 1.20 | % | N/A | N/A | ||||||||||||||
Institutional International Equity | N/A | N/A | N/A | N/A | 1.00 | % | 1.10 | % | ||||||||||||||||
International Growth | 1.45 | % | 1.45 | % | 1.20 | % | 1.20 | % | N/A | N/A | ||||||||||||||
Institutional International Growth | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
International Small Cap Growth | 1.65 | % | 1.65 | % | 1.40 | % | 1.40 | % | 1.25 | % | 1.25 | % | ||||||||||||
Emerging Markets Leaders | 1.65 | % | 1.65 | % | 1.40 | % | 1.40 | % | 1.25 | % | 1.25 | % | ||||||||||||
Emerging Markets Growth | 1.70 | % | 1.70 | % | 1.45 | % | 1.45 | % | 1.30 | % | 1.30 | % | ||||||||||||
Emerging Markets | ||||||||||||||||||||||||
Small Cap Growth | 1.65 | % | 1.65 | % | 1.40 | % | 1.40 | % | 1.25 | % | 1.25 | % | ||||||||||||
Bond | 0.65 | % | 0.65 | % | 0.50 | % | 0.50 | % | 0.35 | % | 0.35 | % | ||||||||||||
Income | 0.85 | % | 0.85 | % | 0.70 | % | 0.70 | % | N/A | N/A | ||||||||||||||
Low Duration | 0.70 | % | 0.70 | % | 0.55 | % | 0.55 | % | 0.40 | % | 0.40 | % | ||||||||||||
Ready Reserves | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||
Macro Allocation | 1.35 | %(b) | N/A | 1.10 | %(b) | N/A | 0.95 | %(b) | N/A |
(a) | Effective April 30, 2013 through April 30, 2014. |
(b) | Effective March 1, 2014 through February 28, 2015. The rates in effect for the period from November 1, 2013 to February 28, 2014 were 1.35%, 1.10% and 0.95% for Class N, Class I and Institutional Class, respectively. |
The Adviser has agreed to voluntarily waive fees and reimburse expenses incurred for the Ready Reserves Fund in order to maintain a minimum yield given the current interest rate environment.
For a period of three years subsequent to a Fund’s commencement of operations, the Adviser is entitled to reimbursement for previously waived fees and reimbursed expenses to the extent the overall expense ratio remains below the expense limitation in place at the time the fee was waived and/or the expense was reimbursed. The total amounts available for reimbursement at December 31, 2014 were as follows (in thousands):
Fund | Available for Reimbursement | Expiration of Reimbursement | |||||
Global Small Cap Growth | $201 | April 10, 2016 | |||||
International Leaders | 246 | August 16, 2015 |
158 | Annual Report | December 31, 2014 |
For the year ended December 31, 2014, the fee waivers and/or reimbursements for each Fund were as follows (in thousands):
Fund | Fund Level Waiver | Class N Specific Waiver | Class I Specific Waiver | Total Waiver | ||||||||||||
Large Cap Growth | $ | 33 | $ | 9 | $ | 29 | $ | 71 | ||||||||
Large Cap Value | 98 | — | — | 98 | ||||||||||||
Mid Cap Growth | — | — | 17 | 17 | ||||||||||||
Mid Cap Value | 83 | 1 | — | 84 | ||||||||||||
Small-Mid Cap Growth | — | 20 | 332 | 352 | ||||||||||||
Small-Mid Cap Value | 97 | — | — | 97 | ||||||||||||
Small Cap Growth | — | 99 | 186 | 285 | ||||||||||||
Small Cap Value | — | 17 | 19 | 36 | ||||||||||||
Global Leaders | 40 | 5 | 28 | 73 | ||||||||||||
Global Small Cap Growth | 119 | — | 7 | 126 | ||||||||||||
International Leaders | 72 | — | 1 | 73 | ||||||||||||
International Equity | 80 | 3 | 63 | 146 | ||||||||||||
Institutional International Equity | 137 | — | — | 137 | ||||||||||||
Emerging Markets Leaders | 130 | — | 9 | 139 | ||||||||||||
Emerging Markets Small Cap Growth | 193 | — | — | 193 | ||||||||||||
Bond | 154 | 18 | 59 | 231 | ||||||||||||
Low Duration | 63 | 1 | 15 | 79 | ||||||||||||
Ready Reserves | 7,562 | — | — | 7,562 | ||||||||||||
Macro Allocation(a) | — | 19 | — | 19 | ||||||||||||
Macro Allocation(b) | — | 196 | 184 | 380 |
(a) | For the period from November 1, 2014 to December 31, 2014. | |
(b) | For the year ended October 31, 2014. |
(b) Underwriting, Distribution Services and Service Agreements
Pursuant to separate Underwriting and Distribution Agreements, William Blair is the principal underwriter and distributor for the continuous offering of shares of the Trust and acts as agent of the Trust in the sale of its shares. The Underwriting Agreement provides that the Distributor will use its best efforts to distribute the Trust’s shares. The Distributor is not compensated under the Underwriting Agreement.
Each Fund, except the Institutional International Equity Fund, Institutional International Growth Fund and Ready Reserves Fund, has a Distribution Agreement with William Blair for distribution services to the Funds’ Class N shares. Each Fund pays William Blair an annual fee, payable monthly, based on a specified percentage of its average daily net assets of Class N shares. The annual rate expressed as a percentage of average daily net assets for Class N is 0.25% for all Funds except the Bond, Income and Low Duration Funds, which is 0.15%. Pursuant to the Distribution Agreement, William Blair enters into related selling group agreements with various firms at various rates for sales of the Funds’ Class N shares.
The Ready Reserves Fund has entered into a Service Agreement with the Adviser under which the Adviser agrees to provide certain support services to Class N shareholders, including shareholder services and automatic sweep services, for a fee of 0.35% of the Fund’s average daily net assets attributable to Class N shares. The Board of Trustees has determined that the amount payable for “service fees” (as defined by FINRA, Financial Industry Regulatory Authority) does not exceed 0.25% of the average annual net assets attributable to the Class N shares of the Ready Reserves Fund.
The Global Leaders, Global Small Cap Growth, International Leaders, International Small Cap Growth, Emerging Markets Leaders, Emerging Markets Growth, Emerging Markets Small Cap Growth, Bond, Low Duration and Macro Allocation Funds have a Shareholder Administration Agreement with William Blair to provide shareholder administration services to Class N and Class I shares. Class N and Class I shares of the Funds pay William Blair an annual fee, payable monthly, based upon 0.15% of average daily net assets attributable to each class, respectively. For the year ended December 31, 2014, the following fees were incurred (in thousands):
December 31, 2014 | William Blair Funds | 159 |
Fund | Class N | Class I | Total | |||||||||
Global Leaders | $ | 8 | $ | 78 | $ | 86 | ||||||
Global Small Cap Growth | 1 | 45 | 46 | |||||||||
International Leaders | — | 17 | 17 | |||||||||
International Small Cap Growth | 24 | 759 | 783 | |||||||||
Emerging Markets Leaders | 2 | 45 | 47 | |||||||||
Emerging Markets Growth | 20 | 247 | 267 | |||||||||
Emerging Markets Small Cap Growth | 17 | 129 | 146 | |||||||||
Bond | 19 | 220 | 239 | |||||||||
Low Duration | 8 | 165 | 173 | |||||||||
Macro Allocation(a) | 38 | 157 | 195 | |||||||||
Macro Allocation(b) | 232 | 592 | 824 |
(a) | For the period from November 1, 2014 to December 31, 2014. | |
(b) | For the year ended October 31, 2014. | |
(5) Investment Transactions
Investment transactions, excluding money market instruments, repurchase agreements and U.S. government securities for the year ended December 31, 2014, were as follows (in thousands):
Fund | Purchases | Sales | ||||||
Growth | $ | 897,322 | $ | 913,022 | ||||
Large Cap Growth | 31,788 | 26,522 | ||||||
Large Cap Value | 1,805 | 2,609 | ||||||
Mid Cap Growth | 313,846 | 431,387 | ||||||
Mid Cap Value | 1,348 | 2,424 | ||||||
Small-Mid Cap Growth | 488,649 | 347,896 | ||||||
Small-Mid Cap Value | 3,194 | 2,253 | ||||||
Small Cap Growth | 446,419 | 565,950 | ||||||
Small Cap Value | 362,787 | 215,031 | ||||||
Global Leaders | 100,263 | 90,433 | ||||||
Global Small Cap Growth | 58,595 | 35,031 | ||||||
International Leaders | 87,453 | 65,570 | ||||||
International Equity | 55,373 | 64,754 | ||||||
Institutional International Equity | 16,120 | 100,935 | ||||||
International Growth | 3,111,603 | 3,635,725 | ||||||
Institutional International Growth | 1,957,947 | 2,000,187 | ||||||
International Small Cap Growth | 1,058,578 | 1,286,602 | ||||||
Emerging Markets Leaders | 131,996 | 99,633 | ||||||
Emerging Markets Growth | 962,957 | 995,192 | ||||||
Emerging Markets Small Cap Growth | 321,254 | 255,490 | ||||||
Bond | 163,579 | 91,962 | ||||||
Income | 32,852 | 29,596 | ||||||
Low Duration | 167,616 | 139,370 | ||||||
Macro Allocation(a) | 104,233 | 99,719 |
(a) | For the period from November 1, 2014 to December 31, 2014. | |
Transactions in written call and put options for the Macro Allocation Fund the period from November 1, 2014 to December 31, 2014 are as follows:
# of Contracts | Premium (in thousands) | |||||||||
Balance at October 31, 2014 | 8,200 | $ | 2,396 | |||||||
Sales | 3,800 | 820 | ||||||||
Closing Buys | (4,100 | ) | (1,686 | ) | ||||||
Expirations | (4,100 | ) | (710 | ) | ||||||
Exercised | — | — | ||||||||
Balance at December 31, 2014 | 3,800 | $ | 820 |
160 | Annual Report | December 31, 2014 |
(6) Financial Derivative Instruments
Each Fund may use derivative instruments to maintain liquidity, to provide hedging, or in anticipation of changes in the composition of its portfolio holdings or as otherwise provided in each Fund’s prospectus. The Macro Allocation Fund may also use derivative instruments to obtain investment exposures. The derivative instruments as of December 31, 2014, as disclosed in each Fund’s Portfolios of Investments, are representative of each Fund’s derivative instrument trading activity during the year ended December 31, 2014.
Derivative transactions carry counterparty risk as they are based on contracts between a Fund and the applicable counterparty. For exchange-traded or cleared derivative contracts, such counterparty risk is limited due to the role of the exchange or clearinghouse. OTC derivative contracts, however, are exposed to counterparty risk in the amount of unrealized gains, net of collateral held, for the duration of the contract.
The Macro Allocation Fund is subject to certain netting arrangements through International Swaps and Derivatives Association, Inc. Master Agreements and Credit Support Annexes (“ISDAs”). The ISDAs maintain provisions for general obligations, representations, agreements, collateral and events of default or termination. The ISDAs cover certain OTC derivative securities entered into by Macro Allocation Fund with various counterparties and allow the Macro Allocation Fund to close out and net its total exposure to a counterparty in the event of a default.
Futures Contracts
A futures contract provides for the future sale by one party and purchase by another party of a specified amount of a specific financial instrument for a specified price at a designated date, time and place. An index futures contract is an agreement pursuant to which the parties agree to take or make delivery of an amount of cash equal to the difference between the value of the index at the close of the last trading day of the contract and the price at which the index futures contract was originally written. If the offsetting purchase price is less than the original sale price, a Fund realizes a gain; if it is more, a Fund realizes a loss. Conversely, if the offsetting sale price is more than the original purchase price, a Fund realizes a gain; if it is less, a Fund realizes a loss. The transaction costs must also be included in these calculations. There can be no assurance, however, that a Fund will be able to enter into an offsetting transaction with respect to a particular futures contract at a particular time. If a Fund is not able to enter into an offsetting transaction, a Fund will continue to be required to maintain the margin deposits on the futures contract.
Upon entering into a futures contract, a Fund is required to pledge to the broker an amount of cash, U.S. government securities, or other liquid assets equal to a certain percentage of the contract amount (initial margin deposit). Futures contracts are marked to market daily and an appropriate payable or receivable for the change in value (“variation margin”) is recorded by a Fund and a cash payment is either made to or received from the broker. Futures held through swaps are marked to market daily, however, a Fund does not make or receive cash payments to/from the broker. Gains or losses are recognized but not considered realized until the contracts expire or are closed and are included in the Statement of Operations.
Options
The purchase or sale of an option by a Fund involves the payment or receipt of a premium by the investor and the corresponding right or obligation, as the case may be, either to purchase or sell the underlying security, commodity, or other instrument for a specific price at a certain time or during a certain period. Purchasing options involves the risk that the underlying instrument will not change price in the manner expected, so the investor loses its premium. Selling options involves potentially greater risk because the investor is exposed to the extent of the actual price movement in the underlying security rather than only the amount of the premium paid (which could result in a potentially unlimited loss). OTC options also involve counterparty credit risk. Purchased options are shown as an asset on the Statement of Assets and Liabilities and are included in Investments in securities. Premiums received for written options are shown as a liability on the Statement of Assets and Liabilities. Realized gains and losses on the sale, expiration or assignment of an option are disclosed on the Statement of Operations.
Forward Foreign Currency Contracts
The Global Equity, International Equity and Multi-Asset and Alternative Funds may enter into forward foreign currency contracts. When entering into a forward foreign currency contract, a Fund agrees to receive or deliver a fixed quantity of foreign currency for an agreed-upon price on an agreed future date. A Fund’s net equity therein, representing unrealized gain or loss on the contracts as measured by the difference between the forward foreign exchange rates at the dates of entry into the contracts and the forward rates at the reporting date, is included in the Statement of Assets and Liabilities. Realized and unrealized gains and losses are included in the Statement of Operations. These instruments may involve market risk, credit risk, or both kinds of risks in excess of the amount recognized in the Statement of Assets and Liabilities. Risks arise from the possible inability of counterparties to meet the terms of their contracts and from the price movements in currencies.
December 31, 2014 | William Blair Funds | 161 |
Swap Contracts
Swap agreements may include total return, interest rate, securities index, commodity, security, currency exchange rate, credit default index, volatility and variance swaps. Swap agreements are two-party contracts entered into primarily by institutional investors for periods ranging from a few weeks to several years. Cleared swaps are transacted through futures commission merchants that are members of central clearing houses with the clearing house serving as a central counterparty similar to transactions in futures contracts. In a standard “swap” transaction, two parties agree to exchange the returns (or differentials in rates of return) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or “swapped” between the parties are calculated with respect to a “notional amount” (i.e., the change in the value of a particular dollar amount invested at a particular interest rate, in a particular foreign currency, or in a “basket” of securities representing a particular index). Swap agreements are subject to the risk that the counterparty to the swap will default on its obligation to pay a Fund and the risk that a Fund will not be able to meet its obligations to pay the counterparty to the swap. Swap agreements may also involve fees, commissions or other costs that may reduce a Fund’s gains from a swap agreement or may cause a Fund to lose money.
Credit Default Swaps—A Fund may invest in credit default swaps as a means of “buying” credit protection (i.e., attempting to mitigate the risk of default or credit quality deterioration in some portion of a Fund’s holdings) or “selling” credit protection (i.e., attempting to gain exposure to an underlying issuer’s credit quality characteristics without directly investing in that issuer). A credit default swap is a contract between a buyer and a seller of protection against a pre-defined credit event (e.g., a ratings downgrade or default) on an underlying reference obligation, which may be a single debt instrument or baskets or indices of securities. A Fund may be a buyer or seller of a credit default swap. As a seller of protection on credit default swap agreements, a Fund will generally receive from the buyer of protection a fixed rate of income throughout the term of the swap provided that there is no credit event. A Fund adds leverage to its portfolio because the Fund is subject to investment exposure on the notional amount of the swap. The maximum potential amount of future payments that a Fund as a seller of protection could be required to make under a credit default swap agreement equals the notional amount of the agreement. Notional amounts of each individual credit default swap agreement outstanding as of period end for which a Fund is the seller of protection are disclosed in Portfolio of Investments. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by a Fund for the same referenced entity or entities. For credit default swap contracts on credit indices, the quoted market prices and resulting values serve as an indicator of the payment performance risk. Increasing market values, in absolute terms when compared to the notional amount of the swap, represent deterioration of the referenced entities’ credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the swap.
Interest Rate Swap—A Fund may invest in interest rate swaps to gain or mitigate exposure to changes in interest rates. Interest rate swap agreements involve a commitment between parties to pay either a fixed interest rate or a floating interest rate based on a notional amount of principal. The parties make payments at predetermined intervals throughout the life of the swap. As a payer, a Fund would make the fixed payment and receive the floating payment. As a receiver, a Fund would make the floating payment and receive the fixed payment.
Total Return Swap—A Fund may invest in total return swaps to gain or mitigate exposure to an underlying security, or securities. Total return swap agreements may involve commitments to pay interest in exchange for the return on the underlying security, or securities. At maturity, a net cash flow is exchanged between the parties based on the total return of the underlying security, or securities, less a financing rate. As a receiver, a Fund would receive a payment for a positive return and would make a payment for a negative return. As a payer, a Fund would make a payment for a positive return and would receive a payment for a negative return.
Variance Swap—A Fund may invest in variance swaps in order to gain or mitigate its exposure to an underlying reference entity such as a broad based index. A variance swap is an agreement between two parties to exchange cash flows based on the measured variance of a reference entity. The payer agrees to exchange the fixed rate, or the variance strike price of the reference entity, to the receiver for the floating rate, or realized variance price of the reference entity. At the time the trade is originated, the agreed upon variance strike price is generally set so that the fair value of the swap is near zero. At maturity, a net cash flow is exchanged between the parties based on the difference between the final realized variance price of the swap and the variance strike price multiplied by the notional, or vega amount. As a receiver of the floating rate, a Fund would receive a payment if the final realized variance price is greater than the variance strike price and would make a payment if the final realized variance price is less than the variance strike price. As a payer of the floating rate, a Fund would receive a payment if the final realized variance price is less than the variance strike price and would make a payment if the final realized variance price is greater than the variance strike price.
162 | Annual Report | December 31, 2014 |
The following table presents the value of financial derivative instruments, by primary risk exposure, as of December 31, 2014 and their respective location on the Statements of Assets and Liabilities (in thousands):
Assets | Liabilities | |||||||||||
Primary Risk Exposure | Statement of Assets and Liabilities | Value | Statement of Assets and Liabilities | Value | ||||||||
Bond | ||||||||||||
Interest rate | Investments in securities, at value | $ | 73 | Options written, at value | $ | — | ||||||
Credit | Unrealized appreciation on swap contracts | — | Unrealized depreciation on swap contracts | 17 | ||||||||
Income | ||||||||||||
Interest rate | Investments in securities, at value | 37 | Options written, at value | — | ||||||||
Low Duration | ||||||||||||
Interest rate | Investments in securities, at value | 73 | Options written, at value | — | ||||||||
Macro Allocation | ||||||||||||
Currency | Unrealized appreciation on forward currency contracts | 17,571 | Unrealized depreciation on forward currency contracts | 10,371 | ||||||||
Equity | Receivable for futures variation margin | 10,032 | Payable for futures variation margin | 8,444 | ||||||||
Interest rate | Receivable for futures variation margin | 19 | Payable for futures variation margin | 3,932 | ||||||||
Currency | Investments in securities, at value | 957 | Options written, at value | — | ||||||||
Equity | Investments in securities, at value | 6,569 | Options written, at value | 505 | ||||||||
Credit | Unrealized appreciation on swap contracts | — | Unrealized depreciation on swap contracts | 15 | ||||||||
Equity | Unrealized appreciation on swap contracts | 547 | Unrealized depreciation on swap contracts | 13,957 | ||||||||
Interest Rate | Unrealized appreciation on swap contracts | — | Unrealized depreciation on swap contracts | 2,172 |
December 31, 2014 | William Blair Funds | 163 |
The following table indicates the effect of derivatives, by primary risk exposure, on the Statements of Operations for the year ended December 31, 2014 (in thousands):
Realized Gain (Loss) | Change in Net Unrealized Appreciation (Depreciation) | |||||||||||
Primary Risk Exposure | Statement of Operations | Value | Statement of Operations | Value | ||||||||
Bond | ||||||||||||
Interest Rate | Options | $ | — | Options | $ | (111 | ) | |||||
Credit | Swaps | (82 | ) | Swaps | (17 | ) | ||||||
Income | ||||||||||||
Interest Rate | Options | — | Options | (56 | ) | |||||||
Low Duration | ||||||||||||
Interest Rate | Options | — | Options | (111 | ) | |||||||
Macro Allocation (a) | ||||||||||||
Currency | Forward foreign currency contracts | 32,654 | Forward foreign currency contracts | (25,008 | ) | |||||||
Equity | Futures Contracts | (7,207 | ) | Futures Contracts | 4,787 | |||||||
Interest rate | Futures Contracts | (5,197 | ) | Futures Contracts | (2,076 | ) | ||||||
Currency | Options | — | Options | 247 | ||||||||
Equity | Options | 2,049 | Options | (3,046 | ) | |||||||
Interest Rate | Options | (1,084 | ) | Options | 1,058 | |||||||
Credit | Swaps | 15 | Swaps | (14 | ) | |||||||
Equity | Swaps | 309 | Swaps | (5,318 | ) | |||||||
Interest Rate | Swaps | 16 | Swaps | (1,117 | ) | |||||||
Macro Allocation (b) | ||||||||||||
Currency | Forward foreign currency contracts | 12,344 | Forward foreign currency contracts | 31,116 | ||||||||
Equity | Futures Contracts | 1,758 | Futures Contracts | (8,387 | ) | |||||||
Interest rate | Futures Contracts | (17,978 | ) | Futures Contracts | 1,888 | |||||||
Currency | Options | 2,830 | Options | — | ||||||||
Equity | Options | 1,414 | Options | 2,441 | ||||||||
Interest Rate | Options | (761 | ) | Options | (1,059 | ) | ||||||
Credit | Swaps | 18 | Swaps | (1 | ) | |||||||
Equity | Swaps | 1,922 | Swaps | (8,681 | ) | |||||||
Interest Rate | Swaps | (2,550 | ) | Swaps | (231 | ) |
(a) | For the period from November 1, 2014 to December 31, 2014. |
(b) | For the year ended October 31, 2014. |
The following table indicates gross OTC derivative asset exposure, by investment type, included in the Statement of Assets and Liabilities at December 31, 2014 (in thousands):
Gross | Gross Amounts Offset in the | Net Amounts of Assets Presented in the | Gross Amounts Not Offset in the Statements of Assets and Liabilities | |||||||||||||||||||||
Description | Amounts of Recognized Assets | Statements of Assets and Liabilities | Statements of Assets and Liabilities | Financial Instruments | Cash Collateral Received | Net Amount | ||||||||||||||||||
Macro Allocation | ||||||||||||||||||||||||
Goldman Sachs | ||||||||||||||||||||||||
Swaps | $ | 547 | $ | — | $ | 547 | $ | — | $ | — | $ | 547 | ||||||||||||
State Street | ||||||||||||||||||||||||
Forward foreign currency contracts | 17,571 | (10,371 | ) | 7,200 | — | — | 7,200 | |||||||||||||||||
Options | 957 | — | 957 | — | — | 957 |
The following table indicates gross OTC derivative liability exposure, by investment type, included in the Statement of Assets and Liabilities at December 31, 2014 (in thousands):
Gross | Gross Amounts Offset in the | Net Amounts of Liabilities Presented in the | Gross Amounts Not Offset in the Statements of Assets and Liabilities | |||||||||||||||||||||
Description | Amounts of Recognized Liabilities | Statements of Assets and Liabilities | Statements of Assets and Liabilities | Financial Instruments | Cash Collateral Pledged | Net Amount (not less than zero) | ||||||||||||||||||
Macro Allocation | ||||||||||||||||||||||||
Credit Suisse | ||||||||||||||||||||||||
Swaps | $ | 16,129 | $ | — | $ | 16,129 | $ | 37,487 | $ | — | $ | — | ||||||||||||
State Street | ||||||||||||||||||||||||
Forward foreign currency contracts | 10,371 | (10,371 | ) | — | — | — | — |
164 | Annual Report | December 31, 2014 |
(7) Fund Share Transactions
The following tables summarizes the activity in capital shares of each Fund for the year ended December 31, 2014 (in thousands):
Class N | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Growth | $ | 31,769 | $ | 38,364 | $ | 67,646 | $ | 2,487 | 2,133 | 2,844 | 4,552 | 425 | ||||||||||||||||||||
Large Cap Growth | 1,924 | 760 | 801 | 1,883 | 183 | 72 | 78 | 177 | ||||||||||||||||||||||||
Large Cap Value | 176 | 131 | 460 | (153 | ) | 13 | 10 | 32 | (9 | ) | ||||||||||||||||||||||
Mid Cap Growth | 7,467 | 4,305 | 14,065 | (2,293 | ) | 494 | 304 | 916 | (118 | ) | ||||||||||||||||||||||
Mid Cap Value | 10 | 25 | 73 | (38 | ) | 1 | 2 | 5 | (2 | ) | ||||||||||||||||||||||
Small-Mid-Cap Growth | 39,843 | 5,936 | 35,973 | 9,806 | 2,127 | 317 | 1,901 | 543 | ||||||||||||||||||||||||
Small-Mid Cap Value | 68 | 12 | 305 | (225 | ) | 5 | 1 | 21 | (15 | ) | ||||||||||||||||||||||
Small Cap Growth | 25,046 | 25,674 | 91,030 | (40,310 | ) | 846 | 1,015 | 3,121 | (1,260 | ) | ||||||||||||||||||||||
Small Cap Value | 9,135 | 1,424 | 26,250 | (15,691 | ) | 522 | 82 | 1,485 | (881 | ) | ||||||||||||||||||||||
Global Leaders | 482 | 8 | 2,092 | (1,602 | ) | 41 | 1 | 179 | (137 | ) | ||||||||||||||||||||||
Global Small Cap Growth | 576 | 24 | 208 | 392 | 46 | 2 | 17 | 31 | ||||||||||||||||||||||||
International Leaders | 18 | — | 17 | 1 | 1 | — | 1 | — | ||||||||||||||||||||||||
International Equity | 149 | 21 | 845 | (675 | ) | 10 | 2 | 60 | (48 | ) | ||||||||||||||||||||||
International Growth | 151,647 | 8,469 | 567,333 | (407,217 | ) | 5,859 | 333 | 21,360 | (15,168 | ) | ||||||||||||||||||||||
International Small Cap Growth | 3,098 | 1,836 | 6,812 | (1,878 | ) | 208 | 146 | 441 | (87 | ) | ||||||||||||||||||||||
Emerging Markets Leaders | 2,361 | 24 | 2,404 | (19 | ) | 254 | 2 | 269 | (13 | ) | ||||||||||||||||||||||
Emerging Markets Growth | 961 | 600 | 2,362 | (801 | ) | 71 | 47 | 173 | (55 | ) | ||||||||||||||||||||||
Emerging Markets Small Cap Growth | 15,026 | 446 | 15,349 | 123 | 920 | 28 | 913 | 35 | ||||||||||||||||||||||||
Bond | 8,599 | 442 | 3,830 | 5,211 | 797 | 41 | 357 | 481 | ||||||||||||||||||||||||
Income | 7,606 | 1,016 | 16,330 | (7,708 | ) | 829 | 111 | 1,782 | (842 | ) | ||||||||||||||||||||||
Low Duration | 1,876 | 56 | 2,039 | (107 | ) | 199 | 6 | 217 | (12 | ) | ||||||||||||||||||||||
Ready Reserves | 816,738 | 136 | 809,920 | 6,954 | 816,737 | 137 | 809,920 | 6,954 | ||||||||||||||||||||||||
Macro Allocation (a) | 16,779 | 7,675 | 13,673 | 10,781 | 1,332 | 639 | 1,085 | 886 | ||||||||||||||||||||||||
Macro Allocation (b) | 152,928 | 2,968 | 109,094 | 46,802 | 12,151 | 241 | 8,583 | 3,809 | ||||||||||||||||||||||||
Class I | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Growth | $ | 136,452 | $ | 83,841 | $ | 105,497 | $ | 114,796 | 8,531 | 5,835 | 6,741 | 7,625 | ||||||||||||||||||||
Large Cap Growth | 10,880 | 3,704 | 6,304 | 8,280 | 998 | 341 | 575 | 764 | ||||||||||||||||||||||||
Large Cap Value | 153 | 293 | 734 | (288 | ) | 10 | 22 | 52 | (20 | ) | ||||||||||||||||||||||
Mid Cap Growth | 39,833 | 42,372 | 148,180 | (65,975 | ) | 2,561 | 2,894 | 9,573 | (4,118 | ) | ||||||||||||||||||||||
Mid Cap Value | 39 | 387 | 960 | (534 | ) | 4 | 30 | 71 | (37 | ) | ||||||||||||||||||||||
Small-Mid-Cap Growth | 255,552 | 60,567 | 135,064 | 181,055 | 12,889 | 3,132 | 6,930 | 9,091 | ||||||||||||||||||||||||
Small-Mid Cap Value | 2,101 | 202 | 837 | 1,466 | 146 | 15 | 58 | 103 | ||||||||||||||||||||||||
Small Cap Growth | 75,868 | 57,143 | 135,175 | (2,164 | ) | 2,433 | 2,119 | 4,372 | 180 | |||||||||||||||||||||||
Small Cap Value | 282,706 | 17,680 | 116,112 | 184,274 | 15,870 | 987 | 6,474 | 10,383 | ||||||||||||||||||||||||
Global Leaders | 3,392 | 155 | 6,905 | (3,358 | ) | 293 | 13 | 602 | (296 | ) | ||||||||||||||||||||||
Global Small Cap Growth | 25,796 | 552 | 831 | 25,517 | 2,077 | 45 | 67 | 2,055 | ||||||||||||||||||||||||
International Leaders | 770 | 72 | 2,634 | (1,792 | ) | 62 | 6 | 207 | (139 | ) | ||||||||||||||||||||||
International Equity | 1,631 | 522 | 9,844 | (7,691 | ) | 115 | 37 | 695 | (543 | ) | ||||||||||||||||||||||
International Growth | 571,312 | 29,393 | 653,235 | (52,530 | ) | 21,072 | 1,131 | 24,369 | (2,166 | ) | ||||||||||||||||||||||
International Small Cap Growth | 101,871 | 46,099 | 190,903 | (42,933 | ) | 6,462 | 3,619 | 12,746 | (2,665 | ) | ||||||||||||||||||||||
Emerging Markets Leaders | 3,054 | 543 | 9,540 | (5,943 | ) | 327 | 61 | 1,049 | (661 | ) | ||||||||||||||||||||||
Emerging Markets Growth | 33,599 | 8,779 | 24,068 | 18,310 | 2,457 | 681 | 1,747 | 1,391 | ||||||||||||||||||||||||
Emerging Markets Small Cap Growth | 59,395 | 3,664 | 6,200 | 56,859 | 3,551 | 226 | 371 | 3,406 | ||||||||||||||||||||||||
Bond | 24,075 | 3,775 | 26,212 | 1,638 | 2,256 | 353 | 2,466 | 143 | ||||||||||||||||||||||||
Income | 12,347 | 1,684 | 13,386 | 645 | 1,358 | 185 | 1,472 | 71 | ||||||||||||||||||||||||
Low Duration | 34,535 | 2,010 | 52,964 | (16,419 | ) | 3,656 | 213 | 5,602 | (1,733 | ) | ||||||||||||||||||||||
Macro Allocation (a) | 112,136 | 18,740 | 53,316 | 77,560 | 8,904 | 1,550 | 4,228 | 6,226 | ||||||||||||||||||||||||
Macro Allocation (b) | 466,290 | 3,143 | 96,388 | 373,045 | 36,494 | 254 | 7,541 | 29,207 |
December 31, 2014 | William Blair Funds | 165 |
Institutional | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Global Leaders | $ | 50,000 | $ | 404 | $ | 34,546 | $ | 15,858 | 4,295 | 34 | 2,964 | 1,365 | ||||||||||||||||||||
International Leaders | 25,600 | 171 | 2,098 | 23,673 | 2,039 | 14 | 168 | 1,885 | ||||||||||||||||||||||||
Institutional International Equity | — | 293 | 85,049 | (84,756 | ) | — | 24 | 6,746 | (6,722 | ) | ||||||||||||||||||||||
Institutional International Growth | 338,472 | 227,055 | 363,134 | 202,393 | 19,547 | 14,783 | 21,209 | 13,121 | ||||||||||||||||||||||||
International Small Cap Growth | 53,813 | 35,854 | 190,247 | (100,580 | ) | 3,360 | 2,801 | 11,999 | (5,838 | ) | ||||||||||||||||||||||
Emerging Markets Leaders | 51,588 | 2,175 | 11,552 | 42,211 | 5,352 | 242 | 1,243 | 4,351 | ||||||||||||||||||||||||
Emerging Markets Growth | 162,217 | 42,676 | 204,847 | 46 | 11,405 | 3,288 | 15,033 | (340 | ) | |||||||||||||||||||||||
Emerging Markets Small Cap Growth | 21,734 | 5,574 | 4,116 | 23,192 | 1,326 | 342 | 249 | 1,419 | ||||||||||||||||||||||||
Bond | 26,873 | 3,580 | 22,006 | 8,447 | 2,538 | 336 | 2,063 | 811 | ||||||||||||||||||||||||
Low Duration | 46,387 | 1,353 | 25,383 | 22,357 | 4,926 | 143 | 2,687 | 2,382 | ||||||||||||||||||||||||
Macro Allocation (a) | 11,788 | 7,340 | 94 | 19,034 | 904 | 607 | 8 | 1,503 | ||||||||||||||||||||||||
Macro Allocation (b) | 141,589 | 130 | — | 141,719 | 11,022 | 11 | — | 11,033 | ||||||||||||||||||||||||
Net Change in Net Assets Relating to Fund Share Activity | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Growth | $ | 168,221 | $ | 122,205 | $ | 173,143 | $ | 117,283 | 10,664 | 8,679 | 11,293 | 8,050 | ||||||||||||||||||||
Large Cap Growth | 12,804 | 4,464 | 7,105 | 10,163 | 1,181 | 413 | 653 | 941 | ||||||||||||||||||||||||
Large Cap Value | 329 | 424 | 1,194 | (441 | ) | 23 | 32 | 84 | (29 | ) | ||||||||||||||||||||||
Mid Cap Growth | 47,300 | 46,677 | 162,245 | (68,268 | ) | 3,055 | 3,198 | 10,489 | (4,236 | ) | ||||||||||||||||||||||
Mid Cap Value | 49 | 412 | 1,033 | (572 | ) | 5 | 32 | 76 | (39 | ) | ||||||||||||||||||||||
Small-Mid-Cap Growth | 295,395 | 66,503 | 171,037 | 190,861 | 15,016 | 3,449 | 8,831 | 9,634 | ||||||||||||||||||||||||
Small-Mid Cap Value | 2,169 | 214 | 1,142 | 1,241 | 151 | 16 | 79 | 88 | ||||||||||||||||||||||||
Small Cap Growth | 100,914 | 82,817 | 226,205 | (42,474 | ) | 3,279 | 3,134 | 7,493 | (1,080 | ) | ||||||||||||||||||||||
Small Cap Value | 291,841 | 19,104 | 142,362 | 168,583 | 16,392 | 1,069 | 7,959 | 9,502 | ||||||||||||||||||||||||
Global Leaders | 53,874 | 567 | 43,543 | 10,898 | 4,629 | 48 | 3,745 | 932 | ||||||||||||||||||||||||
Global Small Cap Growth | 26,372 | 576 | 1,039 | 25,909 | 2,123 | 47 | 84 | 2,086 | ||||||||||||||||||||||||
International Leaders | 26,388 | 243 | 4,749 | 21,882 | 2,102 | 20 | 376 | 1,746 | ||||||||||||||||||||||||
International Equity | 1,780 | 543 | 10,689 | (8,366 | ) | 125 | 39 | 755 | (591 | ) | ||||||||||||||||||||||
Institutional International Equity | — | 293 | 85,049 | (84,756 | ) | — | 24 | 6,746 | (6,722 | ) | ||||||||||||||||||||||
International Growth | 722,959 | 37,862 | 1,220,568 | (459,747 | ) | 26,931 | 1,464 | 45,729 | (17,334 | ) | ||||||||||||||||||||||
Institutional International Growth | 338,472 | 227,055 | 363,134 | 202,393 | 19,547 | 14,783 | 21,209 | 13,121 | ||||||||||||||||||||||||
International Small Cap Growth | 158,782 | 83,789 | 387,962 | (145,391 | ) | 10,030 | 6,566 | 25,186 | (8,590 | ) | ||||||||||||||||||||||
Emerging Markets Leaders | 57,003 | 2,742 | 23,496 | 36,249 | 5,933 | 305 | 2,561 | 3,677 | ||||||||||||||||||||||||
Emerging Markets Growth | 196,777 | 52,055 | 231,277 | 17,555 | 13,933 | 4,016 | 16,953 | 996 | ||||||||||||||||||||||||
Emerging Markets Small Cap Growth | 96,155 | 9,684 | 25,665 | 80,174 | 5,797 | 596 | 1,533 | 4,860 | ||||||||||||||||||||||||
Bond | 59,547 | 7,797 | 52,048 | 15,296 | 5,591 | 730 | 4,886 | 1,435 | ||||||||||||||||||||||||
Income | 19,953 | 2,700 | 29,716 | (7,063 | ) | 2,187 | 296 | 3,254 | (771 | ) | ||||||||||||||||||||||
Low Duration | 82,798 | 3,419 | 80,386 | 5,831 | 8,781 | 362 | 8,506 | 637 | ||||||||||||||||||||||||
Ready Reserves | 816,738 | 136 | 809,920 | 6,954 | 816,737 | 137 | 809,920 | 6,954 | ||||||||||||||||||||||||
Macro Allocation (a) | 140,703 | 33,755 | 67,083 | 107,375 | 11,140 | 2,796 | 5,321 | 8,615 | ||||||||||||||||||||||||
Macro Allocation (b) | 760,807 | 6,241 | 205,482 | 561,566 | 59,667 | 506 | 16,124 | 44,049 |
(a) | For the period from November 1, 2014 to December 31, 2014. |
(b) | For the year ended October 31, 2014. |
166 | Annual Report | December 31, 2014 |
The following tables summarizes the activity in capital shares of each Fund for the year ended December 31, 2013 (in thousands):
Class N | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Growth | $ | 32,046 | $ | 25,781 | $ | 69,760 | $ | (11,933 | ) | 2,330 | 1,788 | 5,007 | (889 | ) | ||||||||||||||||||
Large Cap Growth | 1,479 | 473 | 590 | 1,362 | 161 | 48 | 64 | 145 | ||||||||||||||||||||||||
Large Cap Value | 1,156 | 164 | 1,346 | (26 | ) | 89 | 12 | 107 | (6 | ) | ||||||||||||||||||||||
Mid Cap Growth | 12,598 | 2,490 | 22,921 | (7,833 | ) | 876 | 168 | 1,527 | (483 | ) | ||||||||||||||||||||||
Mid Cap Value | 124 | 23 | 16 | 131 | 10 | 2 | 2 | 10 | ||||||||||||||||||||||||
Small-Mid Cap Growth | 43,420 | 4,482 | 31,843 | 16,059 | 2,394 | 244 | 1,701 | 937 | ||||||||||||||||||||||||
Small-Mid Cap Value | 116 | 12 | 106 | 22 | 8 | 1 | 8 | 1 | ||||||||||||||||||||||||
Small Cap Growth | 62,699 | 35,881 | 49,972 | 48,608 | 1,994 | 1,243 | 1,697 | 1,540 | ||||||||||||||||||||||||
Small Cap Value | 17,875 | 3,744 | 15,623 | 5,996 | 1,055 | 218 | 991 | 282 | ||||||||||||||||||||||||
Global Leaders | 1,886 | 8 | 1,789 | 105 | 186 | 1 | 177 | 10 | ||||||||||||||||||||||||
Global Small Cap Growth (a) | 400 | 5 | 257 | 148 | 38 | 1 | 22 | 17 | ||||||||||||||||||||||||
International Leaders | 38 | 1 | 455 | (416 | ) | 3 | — | 41 | (38 | ) | ||||||||||||||||||||||
International Equity | 414 | 34 | 2,522 | (2,074 | ) | 31 | 3 | 201 | (167 | ) | ||||||||||||||||||||||
International Growth | 221,020 | 15,265 | 304,157 | (67,872 | ) | 9,253 | 598 | 12,532 | (2,681 | ) | ||||||||||||||||||||||
International Small Cap Growth | 4,200 | 876 | 3,714 | 1,362 | 277 | 56 | 254 | 79 | ||||||||||||||||||||||||
Emerging Markets Leaders | 1,891 | 5 | 174 | 1,722 | 207 | — | 19 | 188 | ||||||||||||||||||||||||
Emerging Markets Growth | 904 | 216 | 3,904 | (2,784 | ) | 68 | 17 | 299 | (214 | ) | ||||||||||||||||||||||
Emerging Markets Small Cap Growth | 15,380 | 2 | 9,393 | 5,989 | 1,062 | — | 678 | 384 | ||||||||||||||||||||||||
Bond | 5,636 | 971 | 26,429 | (19,822 | ) | 507 | 89 | 2,434 | (1,838 | ) | ||||||||||||||||||||||
Income | 22,343 | 1,685 | 48,389 | (24,361 | ) | 2,370 | 181 | 5,198 | (2,647 | ) | ||||||||||||||||||||||
Low Duration | 4,501 | 92 | 10,313 | (5,720 | ) | 461 | 9 | 1,069 | (599 | ) | ||||||||||||||||||||||
Ready Reserves | 851,400 | 134 | 955,015 | (103,481 | ) | 851,398 | 136 | 955,015 | (103,481 | ) | ||||||||||||||||||||||
Macro Allocation (b) | 92,466 | 329 | 11,606 | 81,189 | 7,774 | 29 | 964 | 6,839 | ||||||||||||||||||||||||
Class I | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Growth | $ | 84,282 | $ | 47,875 | $ | 91,319 | $ | 40,838 | 5,865 | 3,154 | 6,177 | 2,842 | ||||||||||||||||||||
Large Cap Growth | 10,681 | 2,150 | 2,483 | 10,348 | 1,065 | 214 | 255 | 1,024 | ||||||||||||||||||||||||
Large Cap Value | 1,671 | 371 | 1,376 | 666 | 126 | 28 | 108 | 46 | ||||||||||||||||||||||||
Mid Cap Growth | 124,349 | 31,354 | 172,731 | (17,028 | ) | 8,446 | 2,063 | 11,250 | (741 | ) | ||||||||||||||||||||||
Mid Cap Value | 124 | 385 | 1,033 | (524 | ) | 9 | 29 | 79 | (41 | ) | ||||||||||||||||||||||
Small-Mid Cap Growth | 223,592 | 37,483 | 111,035 | 150,040 | 12,205 | 1,986 | 6,274 | 7,917 | ||||||||||||||||||||||||
Small-Mid Cap Value | 197 | 73 | 11 | 259 | 15 | 5 | 1 | 19 | ||||||||||||||||||||||||
Small Cap Growth | 111,824 | 64,524 | 104,039 | 72,309 | 3,479 | 2,123 | 3,256 | 2,346 | ||||||||||||||||||||||||
Small Cap Value | 118,186 | 21,340 | 47,452 | 92,074 | 7,077 | 1,219 | 2,822 | 5,474 | ||||||||||||||||||||||||
Global Leaders | 5,165 | 193 | 6,960 | (1,602 | ) | 513 | 17 | 669 | (139 | ) | ||||||||||||||||||||||
Global Small Cap Growth (a) | 15,017 | 238 | 461 | 14,794 | 1,434 | 20 | 38 | 1,416 | ||||||||||||||||||||||||
International Leaders | 7,955 | 195 | 2,516 | 5,634 | 712 | 16 | 210 | 518 | ||||||||||||||||||||||||
International Equity | 7,026 | 743 | 9,123 | (1,354 | ) | 547 | 53 | 684 | (84 | ) | ||||||||||||||||||||||
International Growth | 485,084 | 34,191 | 469,220 | 50,055 | 19,777 | 1,310 | 18,884 | 2,203 | ||||||||||||||||||||||||
International Small Cap Growth | 106,880 | 20,890 | 51,427 | 76,343 | 6,920 | 1,322 | 3,375 | 4,867 | ||||||||||||||||||||||||
Emerging Markets Leaders | 11,592 | 70 | 2,598 | 9,064 | 1,294 | 8 | 295 | 1,007 | ||||||||||||||||||||||||
Emerging Markets Growth | 21,934 | 2,843 | 15,774 | 9,003 | 1,641 | 217 | 1,184 | 674 | ||||||||||||||||||||||||
Emerging Markets Small Cap Growth | 51,250 | 58 | 6,461 | 44,847 | 3,623 | 4 | 460 | 3,167 | ||||||||||||||||||||||||
Bond | 37,656 | 5,684 | 59,910 | (16,570 | ) | 3,464 | 529 | 5,552 | (1,559 | ) | ||||||||||||||||||||||
Income | 29,478 | 1,767 | 36,611 | (5,366 | ) | 3,188 | 191 | 3,972 | (593 | ) | ||||||||||||||||||||||
Low Duration | 81,230 | 2,882 | 113,372 | (29,260 | ) | 8,362 | 300 | 11,786 | (3,124 | ) | ||||||||||||||||||||||
Macro Allocation (b) | 203,716 | 625 | 16,787 | 187,554 | 17,023 | 55 | 1,366 | 15,712 |
December 31, 2014 | William Blair Funds | 167 |
Institutional Class | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Global Leaders | $ | 74,297 | $ | 350 | $ | 15,521 | $ | 59,126 | 7,343 | 32 | 1,439 | 5,936 | ||||||||||||||||||||
International Leaders | 46,097 | 348 | 1,137 | 45,308 | 4,087 | 29 | 99 | 4,017 | ||||||||||||||||||||||||
Institutional International Equity | 3,200 | 1,959 | 29,745 | (24,586 | ) | 292 | 159 | 2,651 | (2,200 | ) | ||||||||||||||||||||||
Institutional International Growth | 413,943 | 38,132 | 327,353 | 124,722 | 25,757 | 2,259 | 20,396 | 7,620 | ||||||||||||||||||||||||
International Small Cap Growth | 36,109 | 22,330 | 60,352 | (1,913 | ) | 2,335 | 1,406 | 4,004 | (263 | ) | ||||||||||||||||||||||
Emerging Markets Leaders | 11,199 | 162 | 17,847 | (6,486 | ) | 1,250 | 18 | 1,954 | (686 | ) | ||||||||||||||||||||||
Emerging Markets Growth | 262,198 | 17,128 | 226,015 | 53,311 | 19,076 | 1,297 | 17,504 | 2,869 | ||||||||||||||||||||||||
Emerging Markets Small Cap Growth | 84,727 | 224 | 17,648 | 67,303 | 6,093 | 15 | 1,226 | 4,882 | ||||||||||||||||||||||||
Bond | 19,063 | 3,485 | 20,817 | 1,731 | 1,789 | 325 | 1,920 | 194 | ||||||||||||||||||||||||
Low Duration | 3,419 | 2,773 | 74,654 | (68,462 | ) | 353 | 287 | 7,803 | (7,163 | ) | ||||||||||||||||||||||
Macro Allocation (b) | 5,000 | — | — | 5,000 | 396 | — | — | 396 |
Net Change in Net Assets Relating to Fund Share Activity | ||||||||||||||||||||||||||||||||
Dollars | Shares | |||||||||||||||||||||||||||||||
Fund | Sales | Reinvest | Redemptions | Total | Sales | Reinvest | Redemptions | Total | ||||||||||||||||||||||||
Growth | $ | 116,328 | $ | 73,656 | $ | 161,079 | $ | 28,905 | 8,195 | 4,942 | 11,184 | 1,953 | ||||||||||||||||||||
Large Cap Growth | 12,160 | 2,623 | 3,073 | 11,710 | 1,226 | 262 | 319 | 1,169 | ||||||||||||||||||||||||
Large Cap Value | 2,827 | 535 | 2,722 | 640 | 215 | 40 | 215 | 40 | ||||||||||||||||||||||||
Mid Cap Growth | 136,947 | 33,844 | 195,652 | (24,861 | ) | 9,322 | 2,231 | 12,777 | (1,224 | ) | ||||||||||||||||||||||
Mid Cap Value | 248 | 408 | 1,049 | (393 | ) | 19 | 31 | 81 | (31 | ) | ||||||||||||||||||||||
Small-Mid Cap Growth | 267,012 | 41,965 | 142,878 | 166,099 | 14,599 | 2,230 | 7,975 | 8,854 | ||||||||||||||||||||||||
Small-Mid Cap Value | 313 | 85 | 117 | 281 | 23 | 6 | 9 | 20 | ||||||||||||||||||||||||
Small Cap Growth | 174,523 | 100,405 | 154,011 | 120,917 | 5,473 | 3,366 | 4,953 | 3,886 | ||||||||||||||||||||||||
Small Cap Value | 136,061 | 25,084 | 63,075 | 98,070 | 8,132 | 1,437 | 3,813 | 5,756 | ||||||||||||||||||||||||
Global Leaders | 81,348 | 551 | 24,270 | 57,629 | 8,042 | 50 | 2,285 | 5,807 | ||||||||||||||||||||||||
Global Small Cap Growth (a) | 15,417 | 243 | 718 | 14,942 | 1,472 | 21 | 60 | 1,433 | ||||||||||||||||||||||||
International Leaders | 54,090 | 544 | 4,108 | 50,526 | 4,802 | 45 | 350 | 4,497 | ||||||||||||||||||||||||
International Equity | 7,440 | 777 | 11,645 | (3,428 | ) | 578 | 56 | 885 | (251 | ) | ||||||||||||||||||||||
Institutional International Equity | 3,200 | 1,959 | 29,745 | (24,586 | ) | 292 | 159 | 2,651 | (2,200 | ) | ||||||||||||||||||||||
International Growth | 706,104 | 49,456 | 773,377 | (17,817 | ) | 29,030 | 1,908 | 31,416 | (478 | ) | ||||||||||||||||||||||
Institutional International Growth | 413,943 | 38,132 | 327,353 | 124,722 | 25,757 | 2,259 | 20,396 | 7,620 | ||||||||||||||||||||||||
International Small Cap Growth | 147,189 | 44,096 | 115,493 | 75,792 | 9,532 | 2,784 | 7,633 | 4,683 | ||||||||||||||||||||||||
Emerging Markets Leaders | 24,682 | 237 | 20,619 | 4,300 | 2,751 | 26 | 2,268 | 509 | ||||||||||||||||||||||||
Emerging Markets Growth | 285,036 | 20,187 | 245,693 | 59,530 | 20,785 | 1,531 | 18,987 | 3,329 | ||||||||||||||||||||||||
Emerging Markets Small Cap Growth | 151,357 | 284 | 33,502 | 118,139 | 10,778 | 19 | 2,364 | 8,433 | ||||||||||||||||||||||||
Bond | 62,355 | 10,140 | 107,156 | (34,661 | ) | 5,760 | 943 | 9,906 | (3,203 | ) | ||||||||||||||||||||||
Income | 51,821 | 3,452 | 85,000 | (29,727 | ) | 5,558 | 372 | 9,170 | (3,240 | ) | ||||||||||||||||||||||
Low Duration | 89,150 | 5,747 | 198,339 | (103,442 | ) | 9,176 | 596 | 20,658 | (10,886 | ) | ||||||||||||||||||||||
Ready Reserves | 851,400 | 134 | 955,015 | (103,481 | ) | 851,398 | 136 | 955,015 | (103,481 | ) | ||||||||||||||||||||||
Macro Allocation (b) | 301,182 | 954 | 28,393 | 273,743 | 25,193 | 84 | 2,330 | 22,947 |
(a) | For the period from April 10, 2013 (Commencement of Operations) to December 31, 2013. |
(b) | For the year ended October 31, 2013. |
168 | Annual Report | December 31, 2014 |
Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 14.79 | $ | 12.05 | $ | 10.73 | $ | 11.28 | $ | 9.89 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.07 | ) | (0.07 | ) | (0.01 | ) | (0.04 | ) | (0.01 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | 1.03 | 4.25 | 1.69 | (0.19 | ) | 1.40 | ||||||||||||||
Total from investment operations | 0.96 | 4.18 | 1.68 | (0.23 | ) | 1.39 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | 0.00 | ^ | — | — | ||||||||||||||
Net realized gain | 2.20 | 1.44 | 0.36 | 0.32 | — | |||||||||||||||
Total distributions | 2.20 | 1.44 | 0.36 | 0.32 | — | |||||||||||||||
Net asset value, end of year | $ | 13.55 | $ | 14.79 | $ | 12.05 | $ | 10.73 | $ | 11.28 | ||||||||||
Total return (%) | 6.59 | 35.00 | 15.67 | (1.93 | ) | 14.05 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.18 | 1.19 | 1.20 | 1.21 | 1.16 | |||||||||||||||
Net investment income (loss) | (0.50 | ) | (0.51 | ) | (0.06 | ) | (0.37 | ) | (0.13 | ) | ||||||||||
Class N net assets at end of year (in thousands) | $ | 272,765 | $ | 291,326 | $ | 248,121 | $ | 204,476 | $ | 198,622 | ||||||||||
Portfolio turnover rate (%) | 100 | 52 | 73 | 59 | 66 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 15.56 | $ | 12.58 | $ | 11.18 | $ | 11.71 | $ | 10.24 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.03 | ) | (0.03 | ) | 0.04 | 0.00 | ^ | 0.02 | ||||||||||||
Net realized and unrealized gain (loss) on investments | 1.10 | 4.45 | 1.75 | (0.20 | ) | 1.45 | ||||||||||||||
Total from investment operations | 1.07 | 4.42 | 1.79 | (0.20 | ) | 1.47 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | 0.00 | ^ | 0.03 | 0.01 | 0.00 | ^ | |||||||||||||
Net realized gain | 2.20 | 1.44 | 0.36 | 0.32 | — | |||||||||||||||
Total distributions | 2.20 | 1.44 | 0.39 | 0.33 | 0.00 | ^ | ||||||||||||||
Net asset value, end of year | $ | 14.43 | $ | 15.56 | $ | 12.58 | $ | 11.18 | $ | 11.71 | ||||||||||
Total return (%) | 6.96 | 35.43 | 16.03 | (1.60 | ) | 14.36 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 0.86 | 0.85 | 0.89 | 0.86 | 0.84 | |||||||||||||||
Net investment income (loss) | (0.20 | ) | (0.17 | ) | 0.30 | (0.03 | ) | 0.20 | ||||||||||||
Class I net assets at end of year (in thousands) | $ | 688,038 | $ | 623,225 | $ | 468,124 | $ | 362,266 | $ | 376,991 | ||||||||||
Portfolio turnover rate (%) | 100 | 52 | 73 | 59 | 66 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 169 |
Financial Highlights
Large Cap Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 10.03 | $ | 8.14 | $ | 6.88 | $ | 7.14 | $ | 6.16 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.02 | ) | (0.03 | ) | (0.02 | ) | (0.01 | ) | (0.00 | )^ | ||||||||||
Net realized and unrealized gain (loss) on investments | 1.46 | 2.70 | 1.28 | (0.25 | ) | 0.98 | ||||||||||||||
Total from investment operations | 1.44 | 2.67 | 1.26 | (0.26 | ) | 0.98 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | — | — | — | |||||||||||||||
Net realized gain | 1.01 | 0.78 | — | — | — | |||||||||||||||
Total distributions | 1.01 | 0.78 | — | — | — | |||||||||||||||
Net asset value, end of year | $ | 10.46 | $ | 10.03 | $ | 8.14 | $ | 6.88 | $ | 7.14 | ||||||||||
Total return (%) | 14.29 | 33.00 | 18.31 | (3.64 | ) | 15.91 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.13 | 1.20 | 1.20 | 1.20 | 1.21 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.31 | 1.46 | 1.57 | 1.51 | 1.53 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (0.23 | ) | (0.36 | ) | (0.21 | ) | (0.13 | ) | (0.08 | ) | ||||||||||
Net investment income (loss), before waivers and reimbursements | (0.41 | ) | (0.62 | ) | (0.58 | ) | (0.44 | ) | (0.40 | ) | ||||||||||
Class N net assets at end of year (in thousands) | $ | 8,831 | $ | 6,678 | $ | 4,238 | $ | 3,387 | $ | 7,135 | ||||||||||
Portfolio turnover rate (%) | 50 | 48 | 50 | 67 | 54 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 10.33 | $ | 8.35 | $ | 7.03 | $ | 7.30 | $ | 6.30 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.00 | ^ | (0.01 | ) | 0.00 | ^ | 0.01 | 0.01 | ||||||||||||
Net realized and unrealized gain (loss) on investments | 1.52 | 2.77 | 1.32 | (0.27 | ) | 1.00 | ||||||||||||||
Total from investment operations | 1.52 | 2.76 | 1.32 | (0.26 | ) | 1.01 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | — | 0.01 | 0.01 | |||||||||||||||
Net realized gain | 1.01 | 0.78 | — | — | — | |||||||||||||||
Total distributions | 1.01 | 0.78 | — | 0.01 | 0.01 | |||||||||||||||
Net asset value, end of year | $ | 10.84 | $ | 10.33 | $ | 8.35 | $ | 7.03 | $ | 7.30 | ||||||||||
Total return (%) | 14.65 | 33.24 | 18.78 | (3.54 | ) | 16.03 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.88 | 0.95 | 0.95 | 0.95 | 0.96 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.00 | 1.11 | 1.23 | 1.16 | 1.16 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.02 | (0.11 | ) | 0.03 | 0.11 | 0.16 | ||||||||||||||
Net investment income (loss), before waivers and reimbursements | (0.10 | ) | (0.27 | ) | (0.25 | ) | (0.10 | ) | (0.04 | ) | ||||||||||
Class I net assets at end of year (in thousands) | $ | 50,778 | $ | 40,513 | $ | 24,175 | $ | 21,562 | $ | 24,900 | ||||||||||
Portfolio turnover rate (%) | 50 | 48 | 50 | 67 | 54 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
170 | Annual Report | December 31, 2014 |
Financial Highlights
Large Cap Value Fund
Class N | ||||||||||||||||
Periods Ended December 31, | ||||||||||||||||
2014 | 2013 | 2012 | 2011(a) | |||||||||||||
Net asset value, beginning of year | $ | 13.69 | $ | 11.54 | $ | 9.95 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.10 | 0.09 | 0.11 | 0.03 | ||||||||||||
Net realized and unrealized gain (loss) on investments | 1.04 | 3.70 | 1.57 | (0.05 | ) | |||||||||||
Total from investment operations | 1.14 | 3.79 | 1.68 | (0.02 | ) | |||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | 0.11 | 0.08 | 0.09 | 0.03 | ||||||||||||
Net realized gain | 1.31 | 1.56 | — | 0.00 | ^ | |||||||||||
Total distributions | 1.42 | 1.64 | 0.09 | 0.03 | ||||||||||||
Net asset value, end of year | $ | 13.41 | $ | 13.69 | $ | 11.54 | $ | 9.95 | ||||||||
Total return (%)* | 8.35 | 33.23 | 16.92 | (0.19 | ) | |||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||
Expenses, net of waivers and reimbursements | 1.13 | 1.20 | 1.20 | 1.20 | ||||||||||||
Expenses, before waivers and reimbursements | 3.12 | 3.44 | 4.25 | 7.83 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.71 | 0.64 | 0.96 | 1.41 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | (1.28 | ) | (1.60 | ) | (2.09 | ) | (5.22 | ) | ||||||||
Class N net assets at end of year (in thousands) | $ | 1,438 | $ | 1,604 | $ | 1,416 | $ | 998 | ||||||||
Portfolio turnover rate (%)* | 37 | 83 | 20 | 5 |
Class I | ||||||||||||||||
Periods Ended December 31, | ||||||||||||||||
2014 | 2013 | 2012 | 2011(a) | |||||||||||||
Net asset value, beginning of year | $ | 13.70 | $ | 11.55 | $ | 9.95 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.14 | 0.12 | 0.14 | 0.03 | ||||||||||||
Net realized and unrealized gain (loss) on investments | 1.04 | 3.70 | 1.58 | (0.05 | ) | |||||||||||
Total from investment operations | 1.18 | 3.82 | 1.72 | (0.02 | ) | |||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | 0.15 | 0.11 | 0.12 | 0.03 | ||||||||||||
Net realized gain | 1.31 | 1.56 | — | 0.00 | ^ | |||||||||||
Total distributions | 1.46 | 1.67 | 0.12 | 0.03 | ||||||||||||
Net asset value, end of year | $ | 13.42 | $ | 13.70 | $ | 11.55 | $ | 9.95 | ||||||||
Total return (%)* | 8.65 | 33.47 | 17.28 | (0.19 | ) | |||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||
Expenses, net of waivers and reimbursements | 0.89 | 0.95 | 0.95 | 0.95 | ||||||||||||
Expenses, before waivers and reimbursements | 2.87 | 3.06 | 4.06 | 7.58 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.95 | 0.90 | 1.22 | 1.66 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | (1.03 | ) | (1.21 | ) | (1.89 | ) | (4.97 | ) | ||||||||
Class I net assets at end of year (in thousands) | $ | 3,183 | $ | 3,503 | $ | 2,429 | $ | 1,455 | ||||||||
Portfolio turnover rate (%)* | 37 | 83 | 20 | 5 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from October 24, 2011 (Commencement of Operations) to December 31, 2011. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 171 |
Financial Highlights
Mid Cap Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 15.21 | $ | 12.65 | $ | 11.66 | $ | 12.50 | $ | 10.08 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.12 | ) | (0.13 | ) | (0.02 | ) | (0.08 | ) | (0.05 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | 1.26 | 3.74 | 1.29 | 0.25 | 2.47 | |||||||||||||||
Total from investment operations | 1.14 | 3.61 | 1.27 | 0.17 | 2.42 | |||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | — | — | — | |||||||||||||||
Net realized gain | 2.15 | 1.05 | 0.28 | 1.01 | — | |||||||||||||||
Total distributions | 2.15 | 1.05 | 0.28 | 1.01 | — | |||||||||||||||
Net asset value, end of year | $ | 14.20 | $ | 15.21 | $ | 12.65 | $ | 11.66 | $ | 12.50 | ||||||||||
Total return (%) | 7.53 | 28.77 | 10.90 | 1.65 | 24.01 | |||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.35 | 1.35 | 1.35 | 1.35 | 1.35 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.35 | 1.42 | 1.42 | 1.43 | 1.42 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (0.80 | ) | (0.90 | ) | (0.15 | ) | (0.65 | ) | (0.42 | ) | ||||||||||
Net investment income (loss), before waivers and reimbursements | (0.80 | ) | (0.97 | ) | (0.22 | ) | (0.73 | ) | (0.49 | ) | ||||||||||
Class N net assets at end of year (in thousands) | $ | 37,413 | $ | 41,849 | $ | 40,940 | $ | 30,093 | $ | 13,802 | ||||||||||
Portfolio turnover rate (%) | 81 | 83 | 62 | 70 | 73 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 15.58 | $ | 12.91 | $ | 11.87 | $ | 12.68 | $ | 10.20 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.09 | ) | (0.10 | ) | 0.03 | (0.05 | ) | (0.02 | ) | |||||||||||
Net realized and unrealized gain (loss) on investments | 1.31 | 3.82 | 1.31 | 0.25 | 2.50 | |||||||||||||||
Total from investment operations | 1.22 | 3.72 | 1.34 | 0.20 | 2.48 | |||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | 0.02 | — | — | |||||||||||||||
Net realized gain | 2.15 | 1.05 | 0.28 | 1.01 | — | |||||||||||||||
Total distributions | 2.15 | 1.05 | 0.30 | 1.01 | — | |||||||||||||||
Net asset value, end of year | $ | 14.65 | $ | 15.58 | $ | 12.91 | $ | 11.87 | $ | 12.68 | ||||||||||
Total return (%) | 7.87 | 29.04 | 11.30 | 1.86 | 24.31 | |||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.10 | 1.10 | 1.07 | 1.10 | 1.10 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.10 | 1.15 | 1.07 | 1.13 | 1.15 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (0.55 | ) | (0.65 | ) | 0.19 | (0.42 | ) | (0.14 | ) | |||||||||||
Net investment income (loss), before waivers and reimbursements | (0.55 | ) | (0.70 | ) | 0.19 | (0.45 | ) | (0.19 | ) | |||||||||||
Class I net assets at end of year (in thousands) | $ | 302,373 | $ | 385,779 | $ | 329,295 | $ | 115,661 | $ | 87,446 | ||||||||||
Portfolio turnover rate (%) | 81 | 83 | 62 | 70 | 73 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
172 | Annual Report | December 31, 2014 |
Financial Highlights
Mid Cap Value Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010(a) | ||||||||||||||||
Net asset value, beginning of year | $ | 13.39 | $ | 11.39 | $ | 10.48 | $ | 10.75 | $ | 10.00 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.03 | 0.05 | 0.08 | 0.12 | 0.09 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 1.40 | 3.50 | 1.34 | (0.17 | ) | 0.74 | ||||||||||||||
Total from investment operations | 1.43 | 3.55 | 1.42 | (0.05 | ) | 0.83 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.04 | 0.06 | 0.08 | 0.09 | 0.06 | |||||||||||||||
Net realized gain | 1.90 | 1.49 | 0.43 | 0.13 | 0.02 | |||||||||||||||
Total distributions | 1.94 | 1.55 | 0.51 | 0.22 | 0.08 | |||||||||||||||
Net asset value, end of year | $ | 12.88 | $ | 13.39 | $ | 11.39 | $ | 10.48 | $ | 10.75 | ||||||||||
Total return (%)* | 10.83 | 31.46 | 13.54 | (0.34 | ) | 8.36 | ||||||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.35 | 1.35 | 1.35 | 1.35 | 1.35 | |||||||||||||||
Expenses, before waivers and reimbursements | 3.77 | 3.37 | 3.40 | 3.85 | 5.09 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.23 | 0.36 | 0.70 | 1.15 | 0.92 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | (2.19 | ) | (1.66 | ) | (1.35 | ) | (1.35 | ) | (2.82 | ) | ||||||||||
Class N net assets at end of year (in thousands) | $ | 189 | $ | 232 | $ | 79 | $ | 58 | $ | 4 | ||||||||||
Portfolio turnover rate (%)* | 33 | 42 | 63 | 69 | 35 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010(a) | ||||||||||||||||
Net asset value, beginning of year | $ | 13.40 | $ | 11.39 | $ | 10.48 | $ | 10.76 | $ | 10.00 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.07 | 0.08 | 0.10 | 0.13 | 0.11 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 1.39 | 3.51 | 1.35 | (0.17 | ) | 0.75 | ||||||||||||||
Total from investment operations | 1.46 | 3.59 | 1.45 | (0.04 | ) | 0.86 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.08 | 0.09 | 0.11 | 0.11 | 0.08 | |||||||||||||||
Net realized gain | 1.90 | 1.49 | 0.43 | 0.13 | 0.02 | |||||||||||||||
Total distributions | 1.98 | 1.58 | 0.54 | 0.24 | 0.10 | |||||||||||||||
Net asset value, end of year | $ | 12.88 | $ | 13.40 | $ | 11.39 | $ | 10.48 | $ | 10.76 | ||||||||||
Total return (%)* | 11.04 | 31.82 | 13.77 | (0.25 | ) | 8.66 | ||||||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.10 | 1.10 | 1.10 | 1.10 | 1.10 | |||||||||||||||
Expenses, before waivers and reimbursements | 3.08 | 3.04 | 3.13 | 3.60 | 4.92 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.49 | 0.59 | 0.92 | 1.20 | 1.10 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | (1.49 | ) | (1.35 | ) | (1.11 | ) | (1.30 | ) | (2.72 | ) | ||||||||||
Class I net assets at end of year (in thousands) | $ | 3,579 | $ | 4,225 | $ | 4,058 | $ | 4,515 | $ | 3,389 | ||||||||||
Portfolio turnover rate (%)* | 33 | 42 | 63 | 69 | 35 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from May 3, 2010 (Commencement of Operations) to December 31, 2010. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 173 |
Financial Highlights
Small-Mid Cap Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 18.80 | $ | 14.21 | $ | 13.00 | $ | 14.40 | $ | 11.73 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.12 | ) | (0.15 | ) | 0.02 | (0.11 | ) | (0.09 | ) | |||||||||||
Net realized and unrealized gain (loss) on investments | 1.68 | 6.01 | 1.57 | 0.03 | 2.76 | |||||||||||||||
Total from investment operations | 1.56 | 5.86 | 1.59 | (0.08 | ) | 2.67 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | 0.02 | — | — | |||||||||||||||
Net realized gain | 1.64 | 1.27 | 0.36 | 1.32 | — | |||||||||||||||
Total distributions | 1.64 | 1.27 | 0.38 | 1.32 | — | |||||||||||||||
Net asset value, end of year | $ | 18.72 | $ | 18.80 | $ | 14.21 | $ | 13.00 | $ | 14.40 | ||||||||||
Total return (%) | 8.33 | 41.49 | 12.20 | (0.27 | ) | 22.76 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.35 | 1.35 | 1.35 | 1.35 | 1.35 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.38 | 1.46 | 1.47 | 1.46 | 1.46 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (0.63 | ) | (0.88 | ) | 0.16 | (0.77 | ) | (0.76 | ) | |||||||||||
Net investment income (loss), before waivers and reimbursements | (0.66 | ) | (0.99 | ) | 0.04 | (0.88 | ) | (0.87 | ) | |||||||||||
Class N net assets at end of year (in thousands) | $ | 83,047 | $ | 73,207 | $ | 42,015 | $ | 34,123 | $ | 26,876 | ||||||||||
Portfolio turnover rate (%) | 49 | 53 | 82 | 76 | 93 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 19.34 | $ | 14.55 | $ | 13.32 | $ | 14.68 | $ | 11.93 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.08 | ) | (0.11 | ) | 0.07 | (0.08 | ) | (0.06 | ) | |||||||||||
Net realized and unrealized gain (loss) on investments | 1.74 | 6.17 | 1.58 | 0.04 | 2.81 | |||||||||||||||
Total from investment operations | 1.66 | 6.06 | 1.65 | (0.04 | ) | 2.75 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | 0.06 | — | — | |||||||||||||||
Net realized gain | 1.64 | 1.27 | 0.36 | 1.32 | — | |||||||||||||||
Total distributions | 1.64 | 1.27 | 0.42 | 1.32 | — | |||||||||||||||
Net asset value, end of year | $ | 19.36 | $ | 19.34 | $ | 14.55 | $ | 13.32 | $ | 14.68 | ||||||||||
Total return (%) | 8.62 | 41.89 | 12.36 | 0.01 | 23.05 | |||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.10 | 1.10 | 1.10 | 1.10 | 1.10 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.15 | 1.10 | 1.20 | 1.12 | 1.11 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (0.38 | ) | (0.62 | ) | 0.48 | (0.54 | ) | (0.50 | ) | |||||||||||
Net investment income (loss), before waivers and reimbursements | (0.43 | ) | (0.62 | ) | 0.38 | (0.56 | ) | (0.51 | ) | |||||||||||
Class I net assets at end of year (in thousands) | $ | 793,789 | $ | 617,374 | $ | 349,345 | $ | 219,474 | $ | 181,189 | ||||||||||
Portfolio turnover rate (%) | 49 | 53 | 82 | 76 | 93 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
174 | Annual Report | December 31, 2014 |
Financial Highlights
Small-Mid Cap Value Fund
Class N | ||||||||||||||||
Periods Ended December 31, | ||||||||||||||||
2014 | 2013 | 2012 | 2011(a) | |||||||||||||
Net asset value, beginning of year | $ | 14.11 | $ | 11.29 | $ | 10.45 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.00 | ^ | 0.00 | ^ | 0.10 | 0.00 | ^ | |||||||||
Net realized and unrealized gain (loss) on investments | 0.64 | 4.06 | 1.15 | 0.45 | ||||||||||||
Total from investment operations | 0.64 | 4.06 | 1.25 | 0.45 | ||||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | — | — | 0.09 | — | ||||||||||||
Net realized gain | 1.12 | 1.24 | 0.32 | — | ||||||||||||
Total distributions | 1.12 | 1.24 | 0.41 | — | ||||||||||||
Net asset value, end of year | $ | 13.63 | $ | 14.11 | $ | 11.29 | $ | 10.45 | ||||||||
Total return (%)* | 4.66 | 36.29 | 11.95 | 4.50 | ||||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||
Expenses, net of waivers and reimbursements | 1.40 | 1.40 | 1.40 | 1.40 | ||||||||||||
Expenses, before waivers and reimbursements | 4.50 | 4.50 | 6.34 | 18.68 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.02 | (0.04 | ) | 0.87 | 0.53 | |||||||||||
Net investment income (loss), before waivers and reimbursements | (3.08 | ) | (3.14 | ) | (4.07 | ) | (16.75 | ) | ||||||||
Class N net assets at end of year (in thousands) | $ | 946 | $ | 1,205 | $ | 950 | $ | 860 | ||||||||
Portfolio turnover rate (%)* | 69 | 61 | 56 | 1 |
Class I | ||||||||||||||||
Periods Ended December 31, | ||||||||||||||||
2014 | 2013 | 2012 | 2011(a) | |||||||||||||
Net asset value, beginning of year | $ | 14.12 | $ | 11.29 | $ | 10.45 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.05 | 0.03 | 0.13 | 0.00 | ^ | |||||||||||
Net realized and unrealized gain (loss) on investments | 0.63 | 4.07 | 1.15 | 0.45 | ||||||||||||
Total from investment operations | 0.68 | 4.10 | 1.28 | 0.45 | ||||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | 0.05 | 0.03 | 0.12 | — | ||||||||||||
Net realized gain | 1.12 | 1.24 | 0.32 | — | ||||||||||||
Total distributions | 1.17 | 1.27 | 0.44 | — | ||||||||||||
Net asset value, end of year | $ | 13.63 | $ | 14.12 | $ | 11.29 | $ | 10.45 | ||||||||
Total return (%)* | 4.96 | 36.69 | 12.22 | 4.50 | ||||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||
Expenses, net of waivers and reimbursements | 1.15 | 1.15 | 1.15 | 1.15 | ||||||||||||
Expenses, before waivers and reimbursements | 4.16 | 4.24 | 5.88 | 18.43 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.36 | 0.21 | 1.12 | 0.79 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | (2.65 | ) | (2.88 | ) | (3.61 | ) | (16.49 | ) | ||||||||
Class I net assets at end of year (in thousands) | $ | 3,407 | $ | 2,073 | $ | 1,442 | $ | 1,296 | ||||||||
Portfolio turnover rate (%)* | 69 | 61 | 56 | 1 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from December 15, 2011 (Commencement of Operations) to December 31, 2011. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 175 |
Financial Highlights
Small Cap Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 30.02 | $ | 23.68 | $ | 20.13 | $ | 23.22 | $ | 19.99 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.30 | ) | (0.26 | ) | (0.22 | ) | (0.28 | ) | (0.21 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | 1.02 | 12.52 | 3.87 | (2.81 | ) | 3.44 | ||||||||||||||
Total from investment operations | 0.72 | 12.26 | 3.65 | (3.09 | ) | 3.23 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | — | — | — | |||||||||||||||
Net realized gain | 5.13 | 5.92 | 0.10 | — | — | |||||||||||||||
Total distributions | 5.13 | 5.92 | 0.10 | — | — | |||||||||||||||
Net asset value, end of year | $ | 25.61 | $ | 30.02 | $ | 23.68 | $ | 20.13 | $ | 23.22 | ||||||||||
Total return (%) | 2.62 | 52.76 | 18.15 | (13.31 | ) | 16.16 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.50 | 1.50 | 1.50 | 1.50 | 1.50 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.56 | 1.57 | 1.59 | 1.59 | 1.52 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (1.00 | ) | (0.87 | ) | (0.96 | ) | (1.25 | ) | (1.03 | ) | ||||||||||
Net investment income (loss), before waivers and reimbursements | (1.06 | ) | (0.94 | ) | (1.05 | ) | (1.34 | ) | (1.05 | ) | ||||||||||
Class N net assets at end of year (in thousands) | $ | 148,201 | $ | 211,562 | $ | 130,382 | $ | 202,341 | $ | 396,767 | ||||||||||
Portfolio turnover rate (%) | 82 | 91 | 89 | 97 | 117 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 31.61 | $ | 24.66 | $ | 20.91 | $ | 24.07 | $ | 20.64 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.23 | ) | (0.19 | ) | (0.16 | ) | (0.23 | ) | (0.16 | ) | ||||||||||
Net realized and unrealized gain (loss) on investments | 1.07 | 13.06 | 4.01 | (2.93 | ) | 3.59 | ||||||||||||||
Total from investment operations | 0.84 | 12.87 | 3.85 | (3.16 | ) | 3.43 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | — | — | — | |||||||||||||||
Net realized gain | 5.13 | 5.92 | 0.10 | — | — | |||||||||||||||
Total distributions | 5.13 | 5.92 | 0.10 | — | — | |||||||||||||||
Net asset value, end of year | $ | 27.32 | $ | 31.61 | $ | 24.66 | $ | 20.91 | $ | 24.07 | ||||||||||
Total return (%) | 2.87 | 53.13 | 18.43 | (13.13 | ) | 16.62 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.25 | 1.25 | 1.25 | 1.25 | 1.25 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.30 | 1.27 | 1.35 | 1.35 | 1.25 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (0.75 | ) | (0.63 | ) | (0.71 | ) | (1.00 | ) | (0.76 | ) | ||||||||||
Net investment income (loss), before waivers and reimbursements | (0.80 | ) | (0.65 | ) | (0.81 | ) | (1.10 | ) | (0.76 | ) | ||||||||||
Class I net assets at end of year (in thousands) | $ | 364,241 | $ | 415,797 | $ | 266,431 | $ | 352,397 | $ | 494,822 | ||||||||||
Portfolio turnover rate (%) | 82 | 91 | 89 | 97 | 117 |
Note : Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
176 | Annual Report | December 31, 2014 |
Financial Highlights
Small Cap Value Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 17.63 | $ | 13.65 | $ | 12.26 | $ | 13.71 | $ | 10.49 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | (0.03 | ) | (0.05 | ) | 0.10 | 0.00 | ^ | 0.03 | ||||||||||||
Net realized and unrealized gain (loss) on investments | 0.81 | 5.32 | 1.43 | (0.97 | ) | 3.22 | ||||||||||||||
Total from investment operations | 0.78 | 5.27 | 1.53 | (0.97 | ) | 3.25 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | — | 0.08 | 0.02 | 0.03 | |||||||||||||||
Net realized gain | 0.65 | 1.29 | 0.06 | 0.46 | — | |||||||||||||||
Return of capital | — | — | — | 0.00 | ^ | — | ||||||||||||||
Total distributions | 0.65 | 1.29 | 0.14 | 0.48 | 0.03 | |||||||||||||||
Net asset value, end of year | $ | 17.76 | $ | 17.63 | $ | 13.65 | $ | 12.26 | $ | 13.71 | ||||||||||
Total return (%) | 4.49 | 38.91 | 12.49 | (6.95 | ) | 30.94 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.50 | 1.49 | 1.43 | 1.38 | 1.33 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.53 | 1.55 | 1.60 | 1.60 | 1.57 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | (0.17 | ) | (0.33 | ) | 0.78 | (0.01 | ) | 0.25 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | (0.20 | ) | (0.39 | ) | 0.61 | (0.23 | ) | 0.01 | ||||||||||||
Class N net assets at end of year (in thousands) | $ | 40,223 | $ | 55,464 | $ | 39,084 | $ | 40,712 | $ | 34,285 | ||||||||||
Portfolio turnover rate (%) | 39 | 51 | 51 | 65 | 71 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 18.00 | $ | 13.88 | $ | 12.47 | $ | 13.93 | $ | 10.65 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.02 | (0.01 | ) | 0.14 | 0.03 | 0.05 | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.82 | 5.42 | 1.45 | (0.98 | ) | 3.27 | ||||||||||||||
Total from investment operations | 0.84 | 5.41 | 1.59 | (0.95 | ) | 3.32 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.02 | 0.00 | ^ | 0.12 | 0.03 | 0.04 | ||||||||||||||
Net realized gain | 0.65 | 1.29 | 0.06 | 0.46 | — | |||||||||||||||
Return of capital | — | — | — | 0.02 | — | |||||||||||||||
Total distributions | 0.67 | 1.29 | 0.18 | 0.51 | 0.04 | |||||||||||||||
Net asset value, end of year | $ | 18.17 | $ | 18.00 | $ | 13.88 | $ | 12.47 | $ | 13.93 | ||||||||||
Total return (%) | 4.73 | 39.31 | 12.73 | (6.68 | ) | 31.16 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.23 | 1.24 | 1.18 | 1.14 | 1.10 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.23 | 1.25 | 1.29 | 1.30 | 1.29 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.12 | (0.07 | ) | 1.02 | 0.26 | 0.43 | ||||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.12 | (0.08 | ) | 0.91 | 0.10 | 0.24 | ||||||||||||||
Class I net assets at end of year (in thousands) | $ | 544,963 | $ | 352,832 | $ | 196,184 | $ | 190,686 | $ | 130,214 | ||||||||||
Portfolio turnover rate (%) | 39 | 51 | 51 | 65 | 71 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 177 |
Financial Highlights
Global Leaders Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 11.43 | $ | 9.47 | $ | 8.10 | $ | 8.40 | $ | 6.97 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.02 | 0.02 | 0.03 | 0.02 | (0.01 | ) | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.41 | 1.96 | 1.37 | (0.31 | ) | 1.44 | ||||||||||||||
Total from investment operations | 0.43 | 1.98 | 1.40 | (0.29 | ) | 1.43 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | 0.02 | 0.03 | 0.01 | — | |||||||||||||||
Net realized gain | 0.02 | — | — | — | — | |||||||||||||||
Total distributions | 0.02 | 0.02 | 0.03 | 0.01 | — | |||||||||||||||
Net asset value, end of year | $ | 11.84 | $ | 11.43 | $ | 9.47 | $ | 8.10 | $ | 8.40 | ||||||||||
Total return (%) | 3.76 | 20.86 | 17.25 | (3.47 | ) | 20.52 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.50 | 1.50 | 1.50 | 1.50 | 1.52 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.62 | 1.63 | 1.84 | 1.82 | 1.93 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.16 | 0.18 | 0.29 | 0.29 | (0.09 | ) | ||||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.04 | 0.05 | (0.05 | ) | (0.03 | ) | (0.50 | ) | ||||||||||||
Class N net assets at end of year (in thousands) | $ | 5,007 | $ | 6,403 | $ | 5,215 | $ | 3,740 | $ | 5,101 | ||||||||||
Portfolio turnover rate (%) | 60 | 70 | 73 | 75 | 96 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 11.42 | $ | 9.47 | $ | 8.09 | $ | 8.40 | $ | 6.96 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.04 | 0.04 | 0.05 | 0.04 | 0.01 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.43 | 1.95 | 1.38 | (0.31 | ) | 1.43 | ||||||||||||||
Total from investment operations | 0.47 | 1.99 | 1.43 | (0.27 | ) | 1.44 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.02 | 0.04 | 0.05 | 0.04 | 0.00 | ^ | ||||||||||||||
Net realized gain | 0.02 | — | — | — | — | |||||||||||||||
Total distributions | 0.04 | 0.04 | 0.05 | 0.04 | 0.00 | ^ | ||||||||||||||
Net asset value, end of year | $ | 11.85 | $ | 11.42 | $ | 9.47 | $ | 8.09 | $ | 8.40 | ||||||||||
Total return (%) | 4.08 | 21.05 | 17.64 | (3.26 | ) | 20.73 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.25 | 1.25 | 1.25 | 1.25 | 1.27 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.33 | 1.35 | 1.56 | 1.55 | 1.62 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.38 | 0.40 | 0.54 | 0.52 | 0.16 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.30 | 0.30 | 0.23 | 0.22 | (0.19 | ) | ||||||||||||||
Class I net assets at end of year (in thousands) | $ | 52,090 | $ | 53,562 | $ | 45,757 | $ | 38,834 | $ | 39,776 | ||||||||||
Portfolio turnover rate (%) | 60 | 70 | 73 | 75 | 96 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
178 | Annual Report | December 31, 2014 |
Financial Highlights
Global Leaders Fund
Institutional Class | ||||||||||||
Periods Ended December 31, | ||||||||||||
2014 | 2013 | 2012(a) | ||||||||||
Net asset value, beginning of year | $ | 11.42 | $ | 9.47 | $ | 9.50 | ||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss) | 0.06 | 0.04 | 0.00 | ^ | ||||||||
Net realized and unrealized gain (loss) on investments | 0.43 | 1.97 | (0.03 | ) | ||||||||
Total from investment operations | 0.49 | 2.01 | (0.03 | ) | ||||||||
Less distributions from: | ||||||||||||
Net investment income | 0.04 | 0.06 | — | |||||||||
Net realized gain | 0.02 | — | — | |||||||||
Total distributions | 0.06 | 0.06 | — | |||||||||
Net asset value, end of year | $ | 11.85 | $ | 11.42 | $ | 9.47 | ||||||
Total return (%)* | 4.24 | 21.23 | (0.32 | ) | ||||||||
Ratios to average daily net assets (%):** | ||||||||||||
Expenses, net of waivers and reimbursements | 1.10 | 1.10 | 1.10 | |||||||||
Expenses, before waivers and reimbursements | 1.13 | 1.14 | 1.26 | |||||||||
Net investment income (loss), net of waivers and reimbursements | 0.51 | 0.37 | (0.91 | ) | ||||||||
Net investment income (loss), before waivers and reimbursements | 0.48 | 0.33 | (1.07 | ) | ||||||||
Institutional Class net assets at end of year (in thousands) | $ | 106,565 | $ | 87,118 | $ | 16,022 | ||||||
Portfolio turnover rate (%)* | 60 | 70 | 73 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from December 19, 2012 (Commencement of Operations) to December 31, 2012. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 179 |
Financial Highlights
Global Small Cap Growth Fund
Class N | ||||||||||
Periods Ended December 31, | ||||||||||
2014 | 2013(a) | |||||||||
Net asset value, beginning of year | $ | 12.14 | $ | 10.00 | ||||||
Income (loss) from investment operations: | ||||||||||
Net investment income (loss) | (0.05 | ) | (0.02 | ) | ||||||
Net realized and unrealized gain (loss) on investments | 0.64 | 2.49 | ||||||||
Total from investment operations | 0.59 | 2.47 | ||||||||
Less distributions from: | ||||||||||
Net investment income | — | — | ||||||||
Net realized gain | 0.53 | 0.33 | ||||||||
Total distributions | 0.53 | 0.33 | ||||||||
Net asset value, end of year | $ | 12.20 | $ | 12.14 | ||||||
Total return (%)* | 4.93 | 24.75 | ||||||||
Ratios to average daily net assets (%):** | ||||||||||
Expenses, net of waivers and reimbursements | 1.65 | 1.65 | ||||||||
Expenses, before waivers and reimbursements | 2.07 | 2.47 | ||||||||
Net investment income (loss), net of waivers and reimbursements | (0.42 | ) | (0.23 | ) | ||||||
Net investment income (loss), before waivers and reimbursements | (0.84 | ) | (1.05 | ) | ||||||
Class N net assets at end of year (in thousands) | $ | 591 | $ | 203 | ||||||
Portfolio turnover rate (%)* | 117 | 86 | ||||||||
Class I | ||||||||||
Periods Ended December 31, | ||||||||||
2014 | 2013(a) | |||||||||
Net asset value, beginning of year | $ | 12.16 | $ | 10.00 | ||||||
Income (loss) from investment operations: | ||||||||||
Net investment income (loss) | (0.02 | ) | (0.00 | )^ | ||||||
Net realized and unrealized gain (loss) on investments | 0.65 | 2.50 | ||||||||
Total from investment operations | 0.63 | 2.50 | ||||||||
Less distributions from: | ||||||||||
Net investment income | — | 0.01 | ||||||||
Net realized gain | 0.53 | 0.33 | ||||||||
Total distributions | 0.53 | 0.34 | ||||||||
Net asset value, end of year | $ | 12.26 | $ | 12.16 | ||||||
Total return (%)* | 5.26 | 25.00 | ||||||||
Ratios to average daily net assets (%):** | ||||||||||
Expenses, net of waivers and reimbursements | 1.40 | 1.40 | ||||||||
Expenses, before waivers and reimbursements | 1.81 | 2.20 | ||||||||
Net investment income (loss), net of waivers and reimbursements | (0.18 | ) | 0.03 | |||||||
Net investment income (loss), before waivers and reimbursements | (0.59 | ) | (0.77 | ) | ||||||
Class I net assets at end of year (in thousands) | $ | 42,537 | $ | 17,222 | ||||||
Portfolio turnover rate (%)* | 117 | 86 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from April 10, 2013 (Commencement of Operations) to December 31, 2013. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
180 | Annual Report | December 31, 2014 |
Financial Highlights
International Leaders Fund
Class N | |||||||||||||||
Periods Ended December 31, | |||||||||||||||
2014 | 2013 | 2012(a) | |||||||||||||
Net asset value, beginning of year | $ | 12.65 | $ | 10.81 | $ | 10.00 | |||||||||
Income (loss) from investment operations: | |||||||||||||||
Net investment income (loss) | 0.13 | 0.03 | 0.00 | ^ | |||||||||||
Net realized and unrealized gain (loss) on investments | (0.47 | ) | 1.99 | 0.82 | |||||||||||
Total from investment operations | (0.34 | ) | 2.02 | 0.82 | |||||||||||
Less distributions from: | |||||||||||||||
Net investment income | 0.06 | 0.18 | 0.01 | ||||||||||||
Net realized gain | — | — | — | ||||||||||||
Total distributions | 0.06 | 0.18 | 0.01 | ||||||||||||
Net asset value, end of year | $ | 12.25 | $ | 12.65 | $ | 10.81 | |||||||||
Total return (%)* | (2.67 | ) | 18.75 | 8.16 | |||||||||||
Ratios to average daily net assets (%):** | |||||||||||||||
Expenses, net of waivers and reimbursements | 1.45 | 1.45 | 1.45 | ||||||||||||
Expenses, before waivers and reimbursements | 1.59 | 1.73 | 4.98 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.00 | 0.29 | 0.00 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.86 | 0.01 | (3.53 | ) | |||||||||||
Class N net assets at end of year (in thousands) | $ | 150 | $ | 154 | $ | 542 | |||||||||
Portfolio turnover rate (%)* | 79 | 73 | 16 | ||||||||||||
Class I | |||||||||||||||
Periods Ended December 31, | |||||||||||||||
2014 | 2013 | 2012(a) | |||||||||||||
Net asset value, beginning of year | $ | 12.65 | $ | 10.81 | $ | 10.00 | |||||||||
Income (loss) from investment operations: | |||||||||||||||
Net investment income (loss) | 0.16 | 0.12 | 0.01 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.47 | ) | 1.94 | 0.82 | |||||||||||
Total from investment operations | (0.31 | ) | 2.06 | 0.83 | |||||||||||
Less distributions from: | |||||||||||||||
Net investment income | 0.09 | 0.22 | 0.02 | ||||||||||||
Net realized gain | — | — | — | ||||||||||||
Total distributions | 0.09 | 0.22 | 0.02 | ||||||||||||
Net asset value, end of year | $ | 12.25 | $ | 12.65 | $ | 10.81 | |||||||||
Total return (%)* | (2.43 | ) | 19.10 | 8.26 | |||||||||||
Ratios to average daily net assets (%):** | |||||||||||||||
Expenses, net of waivers and reimbursements | 1.20 | 1.20 | 1.20 | ||||||||||||
Expenses, before waivers and reimbursements | 1.29 | 1.40 | 4.56 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.25 | 1.06 | 0.22 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.16 | 0.86 | (3.14 | ) | |||||||||||
Class I net assets at end of year (in thousands) | $ | 9,561 | $ | 11,629 | $ | 4,336 | |||||||||
Portfolio turnover rate (%)* | 79 | 73 | 16 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from August 16, 2012 (Commencement of Operations) to December 31, 2012. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 181 |
Financial Highlights
International Leaders Fund
Institutional Class | |||||||||||||||
Periods Ended December 31, | |||||||||||||||
2014 | 2013 | 2012(a) | |||||||||||||
Net asset value, beginning of year | $ | 12.65 | $ | 10.80 | $ | 10.24 | |||||||||
Income (loss) from investment operations: | |||||||||||||||
Net investment income (loss) | 0.17 | 0.15 | 0.00 | ^ | |||||||||||
Net realized and unrealized gain (loss) on investments | (0.47 | ) | 1.94 | 0.58 | |||||||||||
Total from investment operations | (0.30 | ) | 2.09 | 0.58 | |||||||||||
Less distributions from: | |||||||||||||||
Net investment income | 0.11 | 0.24 | 0.02 | ||||||||||||
Net realized gain | — | — | — | ||||||||||||
Total distributions | 0.11 | 0.24 | 0.02 | ||||||||||||
Net asset value, end of year | $ | 12.24 | $ | 12.65 | $ | 10.80 | |||||||||
Total return (%)* | (2.34 | ) | 19.39 | 5.67 | |||||||||||
Ratios to average daily net assets (%):** | |||||||||||||||
Expenses, net of waivers and reimbursements | 1.05 | 1.05 | 1.05 | ||||||||||||
Expenses, before waivers and reimbursements | 1.14 | 1.25 | 1.84 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.33 | 1.31 | 0.01 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.24 | 1.11 | (0.78 | ) | |||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 78,251 | $ | 56,991 | $ | 5,286 | |||||||||
Portfolio turnover rate (%)* | 79 | 73 | 16 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from November 2, 2012 (Comencement of Operations) to December 31, 2012. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
182 | Annual Report | December 31, 2014 |
Financial Highlights
International Equity Fund
Class N | |||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | |||||||||||||||||||||
Net asset value, beginning of year | $ | 14.28 | $ | 12.05 | $ | 10.56 | $ | 12.12 | $ | 11.07 | |||||||||||||||
Income (loss) from investment operations: | |||||||||||||||||||||||||
Net investment income (loss) | 0.16 | 0.09 | 0.11 | 0.13 | 0.06 | ||||||||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.60 | ) | 2.25 | 1.75 | (1.69 | ) | 1.15 | ||||||||||||||||||
Total from investment operations | (0.44 | ) | 2.34 | 1.86 | (1.56 | ) | 1.21 | ||||||||||||||||||
Less distributions from: | |||||||||||||||||||||||||
Net investment income | 0.08 | 0.11 | 0.37 | — | 0.16 | ||||||||||||||||||||
Net realized gain | — | — | — | — | — | ||||||||||||||||||||
Total distributions | 0.08 | 0.11 | 0.37 | — | 0.16 | ||||||||||||||||||||
Net asset value, end of year | $ | 13.76 | $ | 14.28 | $ | 12.05 | $ | 10.56 | $ | 12.12 | |||||||||||||||
Total return (%) | (3.09 | ) | 19.47 | 17.57 | (12.87 | ) | 10.92 | ||||||||||||||||||
Ratios to average daily net assets (%): | |||||||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.38 | 1.45 | 1.45 | 1.45 | 1.45 | ||||||||||||||||||||
Expenses, before waivers and reimbursements | 1.56 | 1.65 | 1.71 | 1.60 | 1.66 | ||||||||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.11 | 0.73 | 0.95 | 1.09 | 0.55 | ||||||||||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.93 | 0.53 | 0.69 | 0.94 | 0.34 | ||||||||||||||||||||
Class N net assets at end of year (in thousands) | $ | 3,497 | $ | 4,307 | $ | 5,648 | $ | 6,773 | $ | 13,733 | |||||||||||||||
Portfolio turnover rate (%) | 73 | 88 | 80 | 99 | 71 | ||||||||||||||||||||
Class I | |||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | |||||||||||||||||||||
Net asset value, beginning of year | $ | 14.43 | $ | 12.18 | $ | 10.67 | $ | 12.22 | $ | 11.16 | |||||||||||||||
Income (loss) from investment operations: | |||||||||||||||||||||||||
Net investment income (loss) | 0.19 | 0.14 | 0.14 | 0.17 | 0.10 | ||||||||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.59 | ) | 2.26 | 1.77 | (1.72 | ) | 1.15 | ||||||||||||||||||
Total from investment operations | (0.40 | ) | 2.40 | 1.91 | (1.55 | ) | 1.25 | ||||||||||||||||||
Less distributions from: | |||||||||||||||||||||||||
Net investment income | 0.12 | 0.15 | 0.40 | — | 0.19 | ||||||||||||||||||||
Net realized gain | — | — | — | — | — | ||||||||||||||||||||
Total distributions | 0.12 | 0.15 | 0.40 | — | 0.19 | ||||||||||||||||||||
Net asset value, end of year | $ | 13.91 | $ | 14.43 | $ | 12.18 | $ | 10.67 | $ | 12.22 | |||||||||||||||
Total return (%) | (2.80 | ) | 19.74 | 17.89 | (12.68 | ) | 11.19 | ||||||||||||||||||
Ratios to average daily net assets (%): | |||||||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.13 | 1.20 | 1.20 | 1.20 | 1.20 | ||||||||||||||||||||
Expenses, before waivers and reimbursements | 1.32 | 1.41 | 1.44 | 1.33 | 1.28 | ||||||||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.35 | 1.07 | 1.17 | 1.43 | 0.88 | ||||||||||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.16 | 0.86 | 0.93 | 1.30 | 0.80 | ||||||||||||||||||||
Class I net assets at end of year (in thousands) | $ | 65,012 | $ | 75,271 | $ | 64,536 | $ | 68,884 | $ | 164,322 | |||||||||||||||
Portfolio turnover rate (%) | 73 | 88 | 80 | 99 | 71 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 183 |
Financial Highlights
Institutional International Equity Fund
Institutional Class | |||||||||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | |||||||||||||||||||||
Net asset value, beginning of year | $ | 12.70 | $ | 10.82 | $ | 9.27 | $ | 10.78 | $ | 9.84 | |||||||||||||||
Income (loss) from investment operations: | |||||||||||||||||||||||||
Net investment income (loss) | 0.21 | 0.13 | 0.13 | 0.16 | 0.10 | ||||||||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.65 | ) | 2.00 | 1.57 | (1.47 | ) | 0.99 | ||||||||||||||||||
Total from investment operations | (0.44 | ) | 2.13 | 1.70 | (1.31 | ) | 1.09 | ||||||||||||||||||
Less distributions from: | |||||||||||||||||||||||||
Net investment income | 0.25 | 0.25 | 0.15 | 0.20 | 0.15 | ||||||||||||||||||||
Net realized gain | — | — | — | — | — | ||||||||||||||||||||
Total distributions | 0.25 | 0.25 | 0.15 | 0.20 | 0.15 | ||||||||||||||||||||
Net asset value, end of year | $ | 12.01 | $ | 12.70 | $ | 10.82 | $ | 9.27 | $ | 10.78 | |||||||||||||||
Total return (%) | (3.50 | ) | 19.78 | 18.31 | (12.12 | ) | 11.12 | ||||||||||||||||||
Ratios to average daily net assets (%): | |||||||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.03 | 1.10 | 1.10 | 1.10 | 1.07 | ||||||||||||||||||||
Expenses, before waivers and reimbursements | 1.63 | 1.12 | 1.16 | 1.10 | 1.07 | ||||||||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.61 | 1.12 | 1.28 | 1.48 | 0.97 | ||||||||||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.01 | 1.10 | 1.22 | 1.48 | 0.97 | ||||||||||||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 14,574 | $ | 100,805 | $ | 109,690 | $ | 111,474 | $ | 291,468 | |||||||||||||||
Portfolio turnover rate (%) | 61 | 84 | 86 | 91 | 73 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
184 | Annual Report | December 31, 2014 |
Financial Highlights
International Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 26.30 | $ | 22.43 | $ | 18.68 | $ | 21.85 | $ | 18.55 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.31 | 0.27 | 0.26 | 0.26 | 0.14 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.15 | ) | 3.89 | 4.16 | (3.43 | ) | 3.58 | |||||||||||||
Total from investment operations | (0.84 | ) | 4.16 | 4.42 | (3.17 | ) | 3.72 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.22 | 0.29 | 0.67 | — | 0.42 | |||||||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.22 | 0.29 | 0.67 | — | 0.42 | |||||||||||||||
Net asset value, end of year | $ | 25.24 | $ | 26.30 | $ | 22.43 | $ | 18.68 | $ | 21.85 | ||||||||||
Total return (%) | (3.19 | ) | 18.57 | 23.67 | (14.51 | ) | 20.09 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.44 | 1.44 | 1.44 | 1.45 | 1.43 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.44 | 1.44 | 1.44 | 1.46 | 1.43 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.17 | 1.13 | 1.25 | 1.22 | 0.73 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.17 | 1.13 | 1.25 | 1.21 | 0.73 | |||||||||||||||
Class N net assets at end of year (in thousands) | $ | 978,433 | $ | 1,418,083 | $ | 1,269,736 | $ | 1,277,534 | $ | 2,689,417 | ||||||||||
Portfolio turnover rate (%) | 79 | 97 | 81 | 103 | 99 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 26.91 | $ | 22.94 | $ | 19.10 | $ | 22.34 | $ | 18.95 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.36 | 0.35 | 0.32 | 0.30 | 0.20 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.13 | ) | 3.99 | 4.25 | (3.48 | ) | 3.67 | |||||||||||||
Total from investment operations | (0.77 | ) | 4.34 | 4.57 | (3.18 | ) | 3.87 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.32 | 0.37 | 0.73 | 0.06 | 0.48 | |||||||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.32 | 0.37 | 0.73 | 0.06 | 0.48 | |||||||||||||||
Net asset value, end of year | $ | 25.82 | $ | 26.91 | $ | 22.94 | $ | 19.10 | $ | 22.34 | ||||||||||
Total return (%) | (2.86 | ) | 18.96 | 23.96 | (14.23 | ) | 20.47 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.14 | 1.11 | 1.15 | 1.15 | 1.14 | |||||||||||||||
Net investment income (loss) | 1.36 | 1.43 | 1.51 | 1.40 | 0.99 | |||||||||||||||
Class I net assets at end of year (in thousands) | $ | 2,705,054 | $ | 2,877,541 | $ | 2,402,897 | $ | 1,951,368 | $ | 2,392,762 | ||||||||||
Portfolio turnover rate (%) | 79 | 97 | 81 | 103 | 99 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 185 |
Financial Highlights
Institutional International Growth Fund
Institutional Class | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 17.40 | $ | 14.89 | $ | 12.39 | $ | 14.37 | $ | 12.20 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.26 | 0.25 | 0.23 | 0.21 | 0.14 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.71 | ) | 2.56 | 2.76 | (2.17 | ) | 2.31 | |||||||||||||
Total from investment operations | (0.45 | ) | 2.81 | 2.99 | (1.96 | ) | 2.45 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.32 | 0.30 | 0.49 | 0.02 | 0.28 | |||||||||||||||
Net realized gain | 1.37 | — | — | — | — | |||||||||||||||
Total distributions | 1.69 | 0.30 | 0.49 | 0.02 | 0.28 | |||||||||||||||
Net asset value, end of year | $ | 15.26 | $ | 17.40 | $ | 14.89 | $ | 12.39 | $ | 14.37 | ||||||||||
Total return (%) | (2.66 | ) | 18.90 | 24.11 | (13.66 | ) | 20.10 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 0.97 | 0.97 | 0.98 | 0.99 | 0.99 | |||||||||||||||
Net investment income (loss) | 1.50 | 1.58 | 1.64 | 1.51 | 1.12 | |||||||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 2,339,169 | $ | 2,440,149 | $ | 1,974,130 | $ | 1,542,594 | $ | 1,886,217 | ||||||||||
Portfolio turnover rate (%) | 83 | 97 | 83 | 111 | 99 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
186 | Annual Report | December 31, 2014 |
Financial Highlights
International Small Cap Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 16.08 | $ | 13.46 | $ | 11.36 | $ | 13.07 | $ | 10.40 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.03 | 0.10 | 0.08 | 0.07 | 0.03 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.38 | ) | 3.35 | 2.27 | (1.66 | ) | 2.66 | |||||||||||||
Total from investment operations | (1.35 | ) | 3.45 | 2.35 | (1.59 | ) | 2.69 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.18 | 0.16 | 0.25 | 0.12 | 0.02 | |||||||||||||||
Net realized gain | 1.99 | 0.67 | — | — | — | |||||||||||||||
Total distributions | 2.17 | 0.83 | 0.25 | 0.12 | 0.02 | |||||||||||||||
Net asset value, end of year | $ | 12.56 | $ | 16.08 | $ | 13.46 | $ | 11.36 | $ | 13.07 | ||||||||||
Total return (%) | (8.43 | ) | 25.80 | 20.73 | (12.16 | ) | 25.88 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.58 | 1.59 | 1.61 | 1.64 | 1.55 | |||||||||||||||
Net investment income (loss) | 0.20 | 0.67 | 0.65 | 0.55 | 0.30 | |||||||||||||||
Class N net assets at end of year (in thousands) | $ | 13,676 | $ | 18,910 | $ | 14,771 | $ | 18,991 | $ | 21,916 | ||||||||||
Portfolio turnover rate (%) | 127 | 111 | 76 | 85 | 85 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 16.23 | $ | 13.58 | $ | 11.46 | $ | 13.19 | $ | 10.49 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.09 | 0.15 | 0.12 | 0.12 | 0.07 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.40 | ) | 3.37 | 2.30 | (1.69 | ) | 2.68 | |||||||||||||
Total from investment operations | (1.31 | ) | 3.52 | 2.42 | (1.57 | ) | 2.75 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.23 | 0.20 | 0.30 | 0.16 | 0.05 | |||||||||||||||
Net realized gain | 1.99 | 0.67 | — | — | — | |||||||||||||||
Total distributions | 2.22 | 0.87 | 0.30 | 0.16 | 0.05 | |||||||||||||||
Net asset value, end of year | $ | 12.70 | $ | 16.23 | $ | 13.58 | $ | 11.46 | $ | 13.19 | ||||||||||
Total return (%) | (8.10 | ) | 26.11 | 21.10 | (11.84 | ) | 26.24 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.28 | 1.30 | 1.30 | 1.28 | 1.25 | |||||||||||||||
Net investment income (loss) | 0.56 | 0.96 | 0.95 | 0.92 | 0.61 | |||||||||||||||
Class I net assets at end of year (in thousands) | $ | 364,161 | $ | 508,758 | $ | 359,557 | $ | 364,574 | $ | 349,679 | ||||||||||
Portfolio turnover rate (%) | 127 | 111 | 76 | 85 | 85 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 187 |
Financial Highlights
International Small Cap Growth Fund
Institutional Class | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 16.32 | $ | 13.64 | $ | 11.51 | $ | 13.24 | $ | 10.53 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.12 | 0.18 | 0.15 | 0.14 | 0.09 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (1.41 | ) | 3.41 | 2.31 | (1.68 | ) | 2.69 | |||||||||||||
Total from investment operations | (1.29 | ) | 3.59 | 2.46 | (1.54 | ) | 2.78 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.27 | 0.24 | 0.33 | 0.19 | 0.07 | |||||||||||||||
Net realized gain | 1.99 | 0.67 | — | — | — | |||||||||||||||
Total distributions | 2.26 | 0.91 | 0.33 | 0.19 | 0.07 | |||||||||||||||
Net asset value, end of year | $ | 12.77 | $ | 16.32 | $ | 13.64 | $ | 11.51 | $ | 13.24 | ||||||||||
Total return (%) | (7.91 | ) | 26.49 | 21.36 | (11.60 | ) | 26.40 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.06 | 1.06 | 1.08 | 1.08 | 1.08 | |||||||||||||||
Net investment income (loss), | 0.74 | 1.20 | 1.14 | 1.10 | 0.77 | |||||||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 245,103 | $ | 408,524 | $ | 345,180 | $ | 334,656 | $ | 275,356 | ||||||||||
Portfolio turnover rate (%) | 127 | 111 | 76 | 85 | 85 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
188 | Annual Report | December 31, 2014 |
Financial Highlights
Emerging Markets Leaders Fund
Class N | ||||||||||||||||||||
Periods Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010(a) | ||||||||||||||||
Net asset value, beginning of year | $ | 9.10 | $ | 9.20 | $ | 7.68 | $ | 10.34 | $ | 8.80 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.05 | (0.02 | ) | 0.02 | 0.04 | (0.02 | ) | |||||||||||||
Net realized and unrealized gain (loss) on investments | 0.14 | (0.05 | ) | 1.54 | (2.08 | ) | 1.64 | |||||||||||||
Total from investment operations | 0.19 | (0.07 | ) | 1.56 | (2.04 | ) | 1.62 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.00 | ^ | 0.03 | 0.04 | — | 0.02 | ||||||||||||||
Net realized gain | 0.23 | — | — | 0.62 | 0.06 | |||||||||||||||
Total distributions | 0.23 | 0.03 | 0.04 | 0.62 | 0.08 | |||||||||||||||
Net asset value, end of year | $ | 9.06 | $ | 9.10 | $ | 9.20 | $ | 7.68 | $ | 10.34 | ||||||||||
Total return (%)* | 2.17 | (0.74 | ) | 20.37 | (19.55 | ) | 18.43 | |||||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.65 | 1.65 | 1.65 | 1.65 | 1.65 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.82 | 1.83 | 2.10 | 1.83 | 1.71 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.51 | (0.23 | ) | 0.26 | 0.44 | (0.38 | ) | |||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.34 | (0.41 | ) | (0.19 | ) | 0.26 | (0.44 | ) | ||||||||||||
Class N net assets at end of year (in thousands) | $ | 1,832 | $ | 1,959 | $ | 249 | $ | 46 | $ | 53 | ||||||||||
Portfolio turnover rate (%)* | 131 | 131 | 94 | 142 | 176 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 9.10 | $ | 9.18 | $ | 7.66 | $ | 10.35 | $ | 8.43 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.08 | 0.05 | 0.07 | 0.06 | 0.02 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.15 | (0.10 | ) | 1.51 | (2.08 | ) | 1.98 | |||||||||||||
Total from investment operations | 0.23 | (0.05 | ) | 1.58 | (2.02 | ) | 2.00 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.02 | 0.03 | 0.06 | 0.05 | 0.02 | |||||||||||||||
Net realized gain | 0.23 | — | — | 0.62 | 0.06 | |||||||||||||||
Return of capital | — | — | — | 0.00 | ^ | — | ||||||||||||||
Total distributions | 0.25 | 0.03 | 0.06 | 0.67 | 0.08 | |||||||||||||||
Net asset value, end of year | $ | 9.08 | $ | 9.10 | $ | 9.18 | $ | 7.66 | $ | 10.35 | ||||||||||
Total return (%) | 2.62 | (0.60 | ) | 20.64 | (19.34 | ) | 23.70 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.40 | 1.40 | 1.40 | 1.40 | 1.40 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.60 | 1.58 | 1.75 | 1.58 | 1.52 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.84 | 0.51 | 0.83 | 0.69 | 0.25 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.64 | 0.33 | 0.48 | 0.51 | 0.13 | |||||||||||||||
Class I net assets at end of year (in thousands) | $ | 28,475 | $ | 34,590 | $ | 25,628 | $ | 21,610 | $ | 16,332 | ||||||||||
Portfolio turnover rate (%) | 131 | 131 | 94 | 142 | 176 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from May 3, 2010 (Commencement of Operations) to December 31, 2010. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 189 |
Financial Highlights
Emerging Markets Leaders Fund
Institutional Class | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 9.10 | $ | 9.18 | $ | 7.65 | $ | 10.35 | $ | 8.43 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.08 | 0.06 | 0.08 | 0.09 | 0.04 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.16 | (0.10 | ) | 1.52 | (2.10 | ) | 1.97 | |||||||||||||
Total from investment operations | 0.24 | (0.04 | ) | 1.60 | (2.01 | ) | 2.01 | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.04 | 0.04 | 0.07 | 0.06 | 0.03 | |||||||||||||||
Net realized gain | 0.23 | — | — | 0.63 | 0.06 | |||||||||||||||
Return of capital | — | — | — | 0.00 | ^ | — | ||||||||||||||
Total distributions | 0.27 | 0.04 | 0.07 | 0.69 | 0.09 | |||||||||||||||
Net asset value, end of year | $ | 9.07 | $ | 9.10 | $ | 9.18 | $ | 7.65 | $ | 10.35 | ||||||||||
Total return (%) | 2.68 | (0.46 | ) | 20.97 | (19.30 | ) | 23.84 | |||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 1.25 | 1.25 | 1.25 | 1.25 | 1.26 | |||||||||||||||
Expenses, before waivers and reimbursements | 1.42 | 1.42 | 1.59 | 1.41 | 1.35 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.83 | 0.68 | 0.90 | 0.90 | 0.50 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.66 | 0.51 | 0.56 | 0.74 | 0.41 | |||||||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 75,875 | $ | 36,509 | $ | 43,102 | $ | 26,166 | $ | 78,516 | ||||||||||
Portfolio turnover rate (%) | 131 | 131 | 94 | 142 | 176 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
190 | Annual Report | December 31, 2014 |
Financial Highlights
Emerging Markets Growth Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 13.28 | $ | 13.40 | $ | 11.16 | $ | 15.76 | $ | 12.87 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.08 | 0.05 | 0.07 | 0.07 | (0.01 | ) | ||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.37 | 0.09 | 2.24 | (2.84 | ) | 3.02 | ||||||||||||||
Total from investment operations | 0.45 | 0.14 | 2.31 | (2.77 | ) | 3.01 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.08 | 0.01 | 0.07 | — | 0.12 | |||||||||||||||
Net realized gain | 0.74 | 0.25 | — | 1.83 | — | |||||||||||||||
Total distributions | 0.82 | 0.26 | 0.07 | 1.83 | 0.12 | |||||||||||||||
Net asset value, end of year | $ | 12.91 | $ | 13.28 | $ | 13.40 | $ | 11.16 | $ | 15.76 | ||||||||||
Total return (%) | 3.40 | 1.05 | 20.70 | (17.29 | ) | 23.44 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.64 | 1.68 | 1.69 | 1.68 | 1.63 | |||||||||||||||
Net investment income (loss) | 0.55 | 0.39 | 0.59 | 0.48 | (0.05 | ) | ||||||||||||||
Class N net assets at end of year (in thousands) | $ | 12,638 | $ | 13,723 | $ | 16,724 | $ | 17,474 | $ | 34,324 | ||||||||||
Portfolio turnover rate (%) | 101 | 118 | 90 | 104 | 121 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 13.38 | $ | 13.50 | $ | 11.25 | $ | 15.87 | $ | 12.95 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.11 | 0.08 | 0.11 | 0.11 | 0.04 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.37 | 0.10 | 2.25 | (2.85 | ) | 3.03 | ||||||||||||||
Total from investment operations | 0.48 | 0.18 | 2.36 | (2.74 | ) | 3.07 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.11 | 0.05 | 0.11 | 0.05 | 0.15 | |||||||||||||||
Net realized gain | 0.74 | 0.25 | — | 1.83 | — | |||||||||||||||
Total distributions | 0.85 | 0.30 | 0.11 | 1.88 | 0.15 | |||||||||||||||
Net asset value, end of year | $ | 13.01 | $ | 13.38 | $ | 13.50 | $ | 11.25 | $ | 15.87 | ||||||||||
Total return (%) | 3.65 | 1.36 | 21.01 | (17.00 | ) | 23.77 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.40 | 1.41 | 1.41 | 1.38 | 1.36 | |||||||||||||||
Net investment income (loss) | 0.79 | 0.62 | 0.86 | 0.77 | 0.26 | |||||||||||||||
Class I net assets at end of year (in thousands) | $ | 166,488 | $ | 152,588 | $ | 144,942 | $ | 124,739 | $ | 194,763 | ||||||||||
Portfolio turnover rate (%) | 101 | 118 | 90 | 104 | 121 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 191 |
Financial Highlights
Emerging Markets Growth Fund
Institutional Class | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 13.46 | $ | 13.59 | $ | 11.32 | $ | 15.96 | $ | 13.03 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.14 | 0.12 | 0.14 | 0.14 | 0.06 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.37 | 0.08 | 2.27 | (2.87 | ) | 3.05 | ||||||||||||||
Total from investment operations | 0.51 | 0.20 | 2.41 | (2.73 | ) | 3.11 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.14 | 0.08 | 0.14 | 0.08 | 0.18 | |||||||||||||||
Net realized gain | 0.74 | 0.25 | — | 1.83 | — | |||||||||||||||
Total distributions | 0.88 | 0.33 | 0.14 | 1.91 | 0.18 | |||||||||||||||
Net asset value, end of year | $ | 13.09 | $ | 13.46 | $ | 13.59 | $ | 11.32 | $ | 15.96 | ||||||||||
Total return (%) | 3.85 | 1.49 | 21.28 | (16.82 | ) | 23.91 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses | 1.18 | 1.19 | 1.20 | 1.19 | 1.17 | |||||||||||||||
Net investment income (loss) | 1.00 | 0.87 | 1.12 | 0.93 | 0.43 | |||||||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 806,708 | $ | 833,711 | $ | 802,571 | $ | 675,633 | $ | 1,021,456 | ||||||||||
Portfolio turnover rate (%) | 101 | 118 | 90 | 104 | 121 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
192 | Annual Report | December 31, 2014 |
Financial Highlights
Emerging Markets Small Cap Growth Fund
Class N | ||||||||||||||||
Periods Ended December 31, | ||||||||||||||||
2014 | 2013 | 2012 | 2011(a) | |||||||||||||
Net asset value, beginning of year | $ | 15.12 | $ | 12.99 | $ | 9.73 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.04 | 0.05 | 0.06 | 0.00 | ^ | |||||||||||
Net realized and unrealized gain (loss) on investments | 2.13 | 2.08 | 3.27 | (0.27 | ) | |||||||||||
Total from investment operations | 2.17 | 2.13 | 3.33 | (0.27 | ) | |||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | 0.03 | — | 0.07 | — | ||||||||||||
Net realized gain | 0.74 | 0.00 | ^ | — | — | |||||||||||
Total distributions | 0.77 | 0.00 | ^ | 0.07 | — | |||||||||||
Net asset value, end of year | $ | 16.52 | $ | 15.12 | $ | 12.99 | $ | 9.73 | ||||||||
Total return (%)* | 14.41 | 16.42 | 34.23 | (2.70 | ) | |||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||
Expenses, net of waivers and reimbursements | 1.65 | 1.65 | 1.65 | 1.65 | ||||||||||||
Expenses, before waivers and reimbursements | 1.74 | 2.19 | 4.76 | 9.53 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.21 | 0.38 | 0.56 | 0.08 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.12 | (0.16 | ) | (2.54 | ) | (7.80 | ) | |||||||||
Class N net assets at end of year (in thousands) | $ | 10,745 | $ | 9,313 | $ | 3,016 | $ | 1,012 | ||||||||
Portfolio turnover rate (%)* | 124 | 138 | 78 | 17 |
Class I | ||||||||||||||||
Periods Ended December 31, | ||||||||||||||||
2014 | 2013 | 2012 | 2011(a) | |||||||||||||
Net asset value, beginning of year | $ | 15.13 | $ | 12.99 | $ | 9.73 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.02 | 0.05 | 0.08 | 0.01 | ||||||||||||
Net realized and unrealized gain (loss) on investments | 2.20 | 2.12 | 3.29 | (0.28 | ) | |||||||||||
Total from investment operations | 2.22 | 2.17 | 3.37 | (0.27 | ) | |||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | 0.09 | 0.03 | 0.11 | — | ||||||||||||
Net realized gain | 0.74 | 0.00 | ^ | — | — | |||||||||||
Total distributions | 0.83 | 0.03 | 0.11 | — | ||||||||||||
Net asset value, end of year | $ | 16.52 | $ | 15.13 | $ | 12.99 | $ | 9.73 | ||||||||
Total return (%)* | 14.73 | 16.70 | 34.62 | (2.70 | ) | |||||||||||
Ratios to average daily net assets (%):** | ||||||||||||||||
Expenses, net of waivers and reimbursements | 1.40 | 1.40 | 1.40 | 1.40 | ||||||||||||
Expenses, before waivers and reimbursements | 1.49 | 1.72 | 4.40 | 9.28 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.15 | 0.35 | 0.70 | 0.33 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | 0.06 | 0.03 | (2.30 | ) | (7.55 | ) | ||||||||||
Class I net assets at end of year (in thousands) | $ | 119,662 | $ | 58,123 | $ | 8,763 | $ | 2,260 | ||||||||
Portfolio turnover rate (%)* | 124 | 138 | 78 | 17 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from October 24, 2011 (Comencement of Operations) to December 31, 2011. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 193 |
Financial Highlights
Emerging Markets Small Cap Growth Fund
Institutional Class | ||||||||||||
Periods Ended December 31, | ||||||||||||
2014 | 2013 | 2012(a) | ||||||||||
Net asset value, beginning of year | $ | 15.14 | $ | 13.00 | $ | 12.79 | ||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss) | 0.06 | 0.07 | 0.00 | ^ | ||||||||
Net realized and unrealized gain (loss) on investments | 2.18 | 2.11 | 0.21 | |||||||||
Total from investment operations | 2.24 | 2.18 | 0.21 | |||||||||
Less distributions from: | ||||||||||||
Net investment income | 0.11 | 0.04 | — | |||||||||
Net realized gain | 0.74 | 0.00 | ^ | — | ||||||||
Total distributions | 0.85 | 0.04 | — | |||||||||
Net asset value, end of year | $ | 16.53 | $ | 15.14 | $ | 13.00 | ||||||
Total return (%)* | 14.85 | 16.80 | 1.64 | |||||||||
Ratios to average daily net assets (%):** | ||||||||||||
Expenses, net of waivers and reimbursements | 1.25 | 1.25 | 1.25 | |||||||||
Expenses, before waivers and reimbursements | 1.34 | 1.56 | 2.32 | |||||||||
Net investment income (loss), net of waivers and reimbursements | 0.37 | 0.47 | (0.87 | ) | ||||||||
Net investment income (loss), before waivers and reimbursements | 0.28 | 0.16 | (1.93 | ) | ||||||||
Institutional Class net assets at end of year (in thousands) | $ | 123,496 | $ | 91,663 | $ | 15,242 | ||||||
Portfolio turnover rate (%)* | 124 | 138 | 78 |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
(a) | For the period from December 20, 2012 (Comencement of Operations) to December 31, 2012. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
194 | Annual Report | December 31, 2014 |
Financial Highlights
Bond Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 10.60 | $ | 11.28 | $ | 10.91 | $ | 10.70 | $ | 10.40 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.31 | 0.32 | 0.36 | 0.43 | 0.46 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.23 | (0.47 | ) | 0.53 | 0.34 | 0.35 | ||||||||||||||
Total from investment operations | 0.54 | (0.15 | ) | 0.89 | 0.77 | 0.81 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.40 | 0.42 | 0.45 | 0.47 | 0.48 | |||||||||||||||
Net realized gain | 0.00 | ^ | 0.11 | 0.07 | 0.09 | 0.03 | ||||||||||||||
Total distributions | 0.40 | 0.53 | 0.52 | 0.56 | 0.51 | |||||||||||||||
Net asset value, end of year | $ | 10.74 | $ | 10.60 | $ | 11.28 | $ | 10.91 | $ | 10.70 | ||||||||||
Total return (%) | 5.10 | (1.37 | ) | 8.33 | 7.41 | 7.86 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.65 | 0.65 | 0.65 | 0.65 | 0.65 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.85 | 0.82 | 0.81 | 0.76 | 0.70 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 2.90 | 2.89 | 3.25 | 3.97 | 4.25 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 2.70 | 2.72 | 3.09 | 3.86 | 4.20 | |||||||||||||||
Class N net assets at end of year (in thousands) | $ | 16,720 | $ | 11,389 | $ | 32,867 | $ | 8,345 | $ | 4,479 | ||||||||||
Portfolio turnover rate (%) | 35 | 41 | 25 | 28 | 25 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 10.49 | $ | 11.17 | $ | 10.80 | $ | 10.59 | $ | 10.31 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.33 | 0.33 | 0.38 | 0.45 | 0.47 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.23 | (0.48 | ) | 0.52 | 0.33 | 0.33 | ||||||||||||||
Total from investment operations | 0.56 | (0.15 | ) | 0.90 | 0.78 | 0.80 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.41 | 0.42 | 0.46 | 0.48 | 0.49 | |||||||||||||||
Net realized gain | 0.00 | ^ | 0.11 | 0.07 | 0.09 | 0.03 | ||||||||||||||
Total distributions | 0.41 | 0.53 | 0.53 | 0.57 | 0.52 | |||||||||||||||
Net asset value, end of year | $ | 10.64 | $ | 10.49 | $ | 11.17 | $ | 10.80 | $ | 10.59 | ||||||||||
Total return (%) | 5.37 | (1.28 | ) | 8.54 | 7.62 | 7.89 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.50 | 0.50 | 0.50 | 0.50 | 0.50 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.60 | 0.58 | 0.56 | 0.55 | 0.55 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 3.07 | 3.05 | 3.45 | 4.17 | 4.41 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 2.97 | 2.97 | 3.39 | 4.12 | 4.36 | |||||||||||||||
Class I net assets at end of year (in thousands) | $ | 149,466 | $ | 145,939 | $ | 172,836 | $ | 154,224 | $ | 147,807 | ||||||||||
Portfolio turnover rate (%) | 35 | 41 | 25 | 28 | 25 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 195 |
Financial Highlights
Bond Fund
Institutional Class | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 10.48 | $ | 11.16 | $ | 10.80 | $ | 10.58 | $ | 10.30 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.34 | 0.35 | 0.40 | 0.45 | 0.48 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.23 | (0.48 | ) | 0.51 | 0.36 | 0.34 | ||||||||||||||
Total from investment operations | 0.57 | (0.13 | ) | 0.91 | 0.81 | 0.82 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.42 | 0.44 | 0.48 | 0.50 | 0.51 | |||||||||||||||
Net realized gain | 0.00 | ^ | 0.11 | 0.07 | 0.09 | 0.03 | ||||||||||||||
Total distributions | 0.42 | 0.55 | 0.55 | 0.59 | 0.54 | |||||||||||||||
Net asset value, end of year | $ | 10.63 | $ | 10.48 | $ | 11.16 | $ | 10.80 | $ | 10.58 | ||||||||||
Total return (%) | 5.53 | (1.13 | ) | 8.61 | 7.88 | 8.06 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.35 | 0.35 | 0.35 | 0.35 | 0.35 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.41 | 0.39 | 0.38 | 0.39 | 0.40 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 3.23 | 3.19 | 3.60 | 4.24 | 4.54 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 3.17 | 3.15 | 3.57 | 4.20 | 4.49 | |||||||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 97,341 | $ | 87,527 | $ | 91,039 | $ | 69,447 | $ | 40,490 | ||||||||||
Portfolio turnover rate (%) | 35 | 41 | 25 | 28 | 25 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
196 | Annual Report | December 31, 2014 |
Financial Highlights
Income Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 9.11 | $ | 9.55 | $ | 9.32 | $ | 9.22 | $ | 9.07 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.18 | 0.20 | 0.24 | 0.32 | 0.35 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.10 | (0.35 | ) | 0.31 | 0.15 | 0.19 | ||||||||||||||
Total from investment operations | 0.28 | (0.15 | ) | 0.55 | 0.47 | 0.54 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.27 | 0.29 | 0.32 | 0.37 | 0.39 | |||||||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.27 | 0.29 | 0.32 | 0.37 | 0.39 | |||||||||||||||
Net asset value, end of year | $ | 9.12 | $ | 9.11 | $ | 9.55 | $ | 9.32 | $ | 9.22 | ||||||||||
Total return (%) | 3.06 | (1.61 | ) | 6.00 | 5.21 | 6.04 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.84 | 0.85 | 0.83 | 0.85 | 0.85 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.84 | 1.03 | 0.83 | 0.91 | 0.85 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.99 | 2.13 | 2.49 | 3.40 | 3.79 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.99 | 1.95 | 2.49 | 3.34 | 3.79 | |||||||||||||||
Class N net assets at end of year (in thousands) | $ | 34,020 | $ | 41,662 | $ | 68,947 | $ | 44,802 | $ | 35,755 | ||||||||||
Portfolio turnover rate (%) | 30 | 41 | 33 | 39 | 29 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 9.05 | $ | 9.48 | $ | 9.25 | $ | 9.15 | $ | 9.00 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.20 | 0.21 | 0.26 | 0.34 | 0.37 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | 0.09 | (0.34 | ) | 0.31 | 0.15 | 0.19 | ||||||||||||||
Total from investment operations | 0.29 | (0.13 | ) | 0.57 | 0.49 | 0.56 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.29 | 0.30 | 0.34 | 0.39 | 0.41 | |||||||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.29 | 0.30 | 0.34 | 0.39 | 0.41 | |||||||||||||||
Net asset value, end of year | $ | 9.05 | $ | 9.05 | $ | 9.48 | $ | 9.25 | $ | 9.15 | ||||||||||
Total return (%) | 3.20 | (1.41 | ) | 6.28 | 5.46 | 6.33 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.59 | 0.70 | 0.58 | 0.64 | 0.63 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.59 | 0.77 | 0.58 | 0.64 | 0.63 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 2.24 | 2.30 | 2.78 | 3.66 | 4.01 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 2.24 | 2.23 | 2.78 | 3.66 | 4.01 | |||||||||||||||
Class I net assets at end of year (in thousands) | $ | 64,834 | $ | 64,152 | $ | 72,830 | $ | 67,183 | $ | 77,522 | ||||||||||
Portfolio turnover rate (%) | 30 | 41 | 33 | 39 | 29 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 197 |
Financial Highlights
Low Duration Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 9.52 | $ | 9.83 | $ | 9.82 | $ | 9.90 | $ | 9.93 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.11 | 0.10 | 0.13 | 0.15 | 0.13 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.00) | ^ | (0.16 | ) | 0.14 | 0.02 | 0.05 | |||||||||||||
Total from investment operations | 0.11 | (0.06 | ) | 0.27 | 0.17 | 0.18 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.25 | 0.25 | 0.26 | 0.25 | 0.21 | |||||||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.25 | 0.25 | 0.26 | 0.25 | 0.21 | |||||||||||||||
Net asset value, end of year | $ | 9.38 | $ | 9.52 | $ | 9.83 | $ | 9.82 | $ | 9.90 | ||||||||||
Total return (%) | 1.20 | (0.62 | ) | 2.80 | 1.73 | 1.86 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.70 | 0.70 | 0.70 | 0.70 | 0.70 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.75 | 0.71 | 0.74 | 0.73 | 0.78 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.19 | 1.06 | 1.37 | 1.52 | 1.33 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.14 | 1.05 | 1.33 | 1.49 | 1.25 | |||||||||||||||
Class N net assets at end of year (in thousands) | $ | 4,969 | $ | 5,158 | $ | 11,216 | $ | 6,260 | $ | 6,937 | ||||||||||
Portfolio turnover rate (%) | 83 | 56 | 20 | 43 | 51 |
Class I | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 9.52 | $ | 9.83 | $ | 9.82 | $ | 9.89 | $ | 9.93 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.13 | 0.12 | 0.15 | 0.17 | 0.15 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.01 | ) | (0.17 | ) | 0.14 | 0.02 | 0.04 | |||||||||||||
Total from investment operations | 0.12 | (0.05 | ) | 0.29 | 0.19 | 0.19 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.27 | 0.26 | 0.28 | 0.26 | 0.23 | |||||||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.27 | 0.26 | 0.28 | 0.26 | 0.23 | |||||||||||||||
Net asset value, end of year | $ | 9.37 | $ | 9.52 | $ | 9.83 | $ | 9.82 | $ | 9.89 | ||||||||||
Total return (%) | 1.24 | (0.47 | ) | 2.96 | 1.99 | 1.89 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.55 | 0.55 | 0.55 | 0.55 | 0.55 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.60 | 0.56 | 0.57 | 0.58 | 0.63 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.35 | 1.24 | 1.52 | 1.67 | 1.46 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.30 | 1.23 | 1.50 | 1.64 | 1.38 | |||||||||||||||
Class I net assets at end of year (in thousands) | $ | 104,433 | $ | 122,583 | $ | 157,213 | $ | 82,828 | $ | 88,568 | ||||||||||
Portfolio turnover rate (%) | 83 | 56 | 20 | 43 | 51 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
198 | Annual Report | December 31, 2014 |
Financial Highlights
Low Duration Fund
Institutional Class | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 9.53 | $ | 9.83 | $ | 9.83 | $ | 9.90 | $ | 9.93 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.14 | 0.13 | 0.17 | 0.18 | 0.16 | |||||||||||||||
Net realized and unrealized gain (loss) on investments | (0.01 | ) | (0.15 | ) | 0.12 | 0.03 | 0.05 | |||||||||||||
Total from investment operations | 0.13 | (0.02 | ) | 0.29 | 0.21 | 0.21 | ||||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.28 | 0.28 | 0.29 | 0.28 | 0.24 | |||||||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.28 | 0.28 | 0.29 | 0.28 | 0.24 | |||||||||||||||
Net asset value, end of year | $ | 9.38 | $ | 9.53 | $ | 9.83 | $ | 9.83 | $ | 9.90 | ||||||||||
Total return (%) | 1.40 | (0.20 | ) | 3.01 | 2.14 | 2.15 | ||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.40 | 0.39 | 0.40 | 0.40 | 0.40 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.43 | 0.39 | 0.41 | 0.42 | 0.48 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 1.45 | 1.37 | 1.68 | 1.81 | 1.61 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.42 | 1.37 | 1.67 | 1.79 | 1.53 | |||||||||||||||
Institutional Class net assets at end of year (in thousands) | $ | 68,095 | $ | 46,485 | $ | 118,401 | $ | 68,059 | $ | 47,965 | ||||||||||
Portfolio turnover rate (%) | 83 | 56 | 20 | 43 | 51 |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 199 |
Financial Highlights
Ready Reserves Fund
Class N | ||||||||||||||||||||
Years Ended December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | ||||||||||||||||
Net asset value, beginning of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Income (loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | ||||||||||
Net realized and unrealized gain (loss) on investments | — | — | — | — | — | |||||||||||||||
Total from investment operations | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | ||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | ||||||||||
Net realized gain | — | — | — | — | — | |||||||||||||||
Total distributions | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | 0.00 | ^ | ||||||||||
Net asset value, end of year | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | $ | 1.00 | ||||||||||
Total return (%) | 0.01 | 0.01 | 0.01 | 0.01 | 0.01 | |||||||||||||||
Ratios to average daily net assets (%): | ||||||||||||||||||||
Expenses, net of waivers and reimbursements | 0.07 | 0.10 | 0.14 | 0.14 | 0.24 | |||||||||||||||
Expenses, before waivers and reimbursements | 0.62 | 0.62 | 0.62 | 0.62 | 0.61 | |||||||||||||||
Net investment income (loss), net of waivers and reimbursements | 0.01 | 0.01 | 0.01 | 0.01 | 0.01 | |||||||||||||||
Net investment income (loss), before waivers and reimbursements | (0.54 | ) | (0.51 | ) | (0.47 | ) | (0.47 | ) | (0.36 | ) | ||||||||||
Class N net assets at end of year (in thousands) | $ | 1,418,687 | $ | 1,411,733 | $ | 1,515,330 | $ | 1,271,746 | $ | 1,216,543 |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
200 | Annual Report | December 31, 2014 |
Financial Highlights
Macro Allocation Fund
Class N | ||||||||||||||||
Period Ended December 31, | Periods Ended October 31, | |||||||||||||||
2014(b) | 2014 | 2013 | 2012(a) | |||||||||||||
Net asset value, beginning of year | $ | 13.07 | $ | 12.61 | $ | 11.28 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.04 | 0.02 | 0.05 | 0.11 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.31 | ) | 0.76 | 1.59 | 1.24 | |||||||||||
Total from investment operations | (0.27 | ) | 0.78 | 1.64 | 1.35 | |||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | 0.66 | 0.09 | 0.11 | 0.07 | ||||||||||||
Net realized gain | — | 0.23 | 0.20 | — | ||||||||||||
Total distributions | 0.66 | 0.32 | 0.31 | 0.07 | ||||||||||||
Net asset value, end of year | $ | 12.14 | $ | 13.07 | $ | 12.61 | $ | 11.28 | ||||||||
Total return (%)* | (2.00 | ) | 6.34 | 14.87 | 13.61 | |||||||||||
Ratios to average daily net assets (%)**: | ||||||||||||||||
Expenses (excluding short dividend expense), net of waivers and reimbursements | 1.35 | 1.35 | 1.35 | 1.35 | ||||||||||||
Expenses, net of waivers and reimbursements | 1.38 | 1.47 | 1.49 | 1.41 | ||||||||||||
Expenses, before waivers and reimbursements | 1.46 | 1.60 | 1.78 | 2.95 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 2.06 | 0.20 | 0.37 | 1.18 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | 1.98 | 0.07 | 0.08 | (0.36 | ) | |||||||||||
Class N net assets at end of year (in thousands) | $ | 150,778 | $ | 150,785 | $ | 97,498 | $ | 10,045 | ||||||||
Portfolio turnover rate (%)* | 17 | 59 | 10 | 40 |
Class I | ||||||||||||||||
Period Ended December 31, | Periods Ended October 31, | |||||||||||||||
2014(b) | 2014 | 2013 | 2012(a) | |||||||||||||
Net asset value, beginning of year | $ | 13.15 | $ | 12.66 | $ | 11.31 | $ | 10.00 | ||||||||
Income (loss) from investment operations: | ||||||||||||||||
Net investment income (loss) | 0.05 | 0.04 | 0.07 | 0.16 | ||||||||||||
Net realized and unrealized gain (loss) on investments | (0.31 | ) | 0.78 | 1.60 | 1.22 | |||||||||||
Total from investment operations | (0.26 | ) | 0.82 | 1.67 | 1.38 | |||||||||||
Less distributions from: | ||||||||||||||||
Net investment income | 0.67 | 0.10 | 0.12 | 0.07 | ||||||||||||
Net realized gain | — | 0.23 | 0.20 | — | ||||||||||||
Total distributions | 0.67 | 0.33 | 0.32 | 0.07 | ||||||||||||
Net asset value, end of year | $ | 12.22 | $ | 13.15 | $ | 12.66 | $ | 11.31 | ||||||||
Total return (%)* | (1.94 | ) | 6.60 | 15.06 | 13.91 | |||||||||||
Ratios to average daily net assets (%)**: | ||||||||||||||||
Expenses (excluding short dividend expense), net of waivers and reimbursements | 1.07 | 1.10 | 1.10 | 1.10 | ||||||||||||
Expenses, net of waivers and reimbursements | 1.10 | 1.22 | 1.24 | 1.18 | ||||||||||||
Expenses, before waivers and reimbursements | 1.10 | 1.27 | 1.41 | 2.94 | ||||||||||||
Net investment income (loss), net of waivers and reimbursements | 2.33 | 0.32 | 0.62 | 1.67 | ||||||||||||
Net investment income (loss), before waivers and reimbursements | 2.33 | 0.27 | 0.45 | (0.09 | ) | |||||||||||
Class I net assets at end of year (in thousands) | $ | 649,756 | $ | 617,531 | $ | 224,860 | $ | 23,095 | ||||||||
Portfolio turnover rate (%)* | 17 | 59 | 10 | 40 |
(a) | For the period from November 29, 2011 (Commencement of Operations) to October 31, 2012. |
(b) | For the period from November 1, 2014 to December 31, 2014. |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
December 31, 2014 | William Blair Funds | 201 |
Financial Highlights
Macro Allocation Fund
Institutional Class | ||||||||||||
Period Ended December 31, | Periods Ended October 31, | |||||||||||
2014(b) | 2014 | 2013(a) | ||||||||||
Net asset value, beginning of year | $ | 13.16 | $ | 12.66 | $ | 12.63 | ||||||
Income (loss) from investment operations: | ||||||||||||
Net investment income (loss) | 0.05 | 0.04 | 0.00 | ^ | ||||||||
Net realized and unrealized gain (loss) on investments | (0.31 | ) | 0.79 | 0.03 | ||||||||
Total from investment operations | (0.26 | ) | 0.83 | 0.03 | ||||||||
Less distributions from: | ||||||||||||
Net investment income | 0.67 | 0.10 | — | |||||||||
Net realized gain | — | 0.23 | — | |||||||||
Total distributions | 0.67 | 0.33 | — | |||||||||
Net asset value, end of year | $ | 12.23 | $ | 13.16 | $ | 12.66 | ||||||
Total return (%)* | (1.91 | ) | 6.71 | 0.24 | ||||||||
Ratios to average daily net assets (%)**: | ||||||||||||
Expenses (excluding short dividend expense), net of waivers and reimbursements | 0.88 | 0.93 | 0.95 | |||||||||
Expenses, net of waivers and reimbursements | 0.91 | 1.05 | 1.00 | |||||||||
Expenses, before waivers and reimbursements | 0.91 | 1.05 | 1.11 | |||||||||
Net investment income (loss), net of waivers and reimbursements | 2.54 | 0.32 | (0.99 | ) | ||||||||
Net investment income (loss), before waivers and reimbursements | 2.54 | 0.32 | (1.10 | ) | ||||||||
Institutional Class net assets at end of year (in thousands) | $ | 158,152 | $ | 150,447 | $ | 5,014 | ||||||
Portfolio turnover rate (%)* | 17 | 59 | 10 |
(a) | For the period from October 21, 2013 (Commencement of Share Class) to October 31, 2013. |
(b) | For the period from November 1, 2014 to December 31, 2014. |
* | Rates not annualized for periods that are less than a year. |
** | Rates are annualized for periods that are less than a year. |
^ | Amount is less than $0.005 per share. |
Note: Net investment income (loss) per share is based on the average shares outstanding during the year.
Performance cited represents past performance. Past performance does not guarantee future results and current performance may be lower or higher than the data quoted. Results shown are annual returns, which assume reinvestment of dividends and capital gains. Investment returns and principal will fluctuate and you may have a gain or loss when you sell shares. For the most current month-end performance information, please call 1-800-742-7272 or visit our Web site at www.williamblairfunds.com.
202 | Annual Report | December 31, 2014 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees and Shareholders of William Blair Funds
We have audited the accompanying statements of assets and liabilities, including the portfolios of investments, of the William Blair Funds (comprising, respectively, the Growth Fund, Large Cap Growth Fund, Large Cap Value Fund, Mid Cap Growth Fund, Mid Cap Value Fund, Small-Mid Cap Growth Fund, Small-Mid Cap Value Fund, Small Cap Growth Fund, Small Cap Value Fund, Global Leaders Fund, Global Small Cap Growth Fund, International Leaders Fund, International Equity Fund, Institutional International Equity Fund, International Growth Fund, Institutional International Growth Fund, International Small Cap Growth Fund, Emerging Markets Leaders Fund, Emerging Markets Growth Fund, Emerging Markets Small Cap Growth Fund, Bond Fund, Income Fund, Low Duration Fund, Ready Reserves Fund, and Macro Allocation Fund (collectively, the “Funds”)) as of December 31, 2014, and the related statements of operations, statements of changes in net assets, and the financial highlights for the periods indicated therein. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Funds’ internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2014, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the respective funds constituting the William Blair Funds at December 31, 2014, the results of their operations, the changes in their net assets, and the financial highlights for the periods indicated therein in conformity with U.S. generally accepted accounting principles.
Chicago, Illinois
February 23, 2015
December 31, 2014 | William Blair Funds | 203 |
Trustees and Officers (Unaudited). The trustees and officers of the William Blair Funds, their year of birth, their principal occupations during the last five years, their affiliations, if any, with William Blair & Company, L.L.C., and other significant affiliations are set forth below. The address of each officer and trustee is 222 West Adams Street, Chicago, Illinois 60606.
Number of | ||||||||||
Term of | Portfolios | |||||||||
Office and | in Trust | |||||||||
Position(s) | Length of | Principal | Complex | |||||||
Held with | Time | Occupation(s) | Overseen | Other Directorships | ||||||
Name and Year of Birth | Trust | Served | During Past 5 Years | by Trustee | Held by Trustee | |||||
Interested Trustees | ||||||||||
Michelle R. Seitz, 1965* | Chairman of the Board of Trustees and President | Trustee since 2002; Chairman since 2010 and President since 2007 | Partner, William Blair & Company, L.L.C.; Limited Partner, WBC Holdings, L.P. (since 2008); Member, WBC GP L.L.P. (since November 2008); Director, William Blair International, Ltd. (U.K.) (since 2012) | 25 | Chairman, William Blair SICAV; Director, William Blair MAS Ltd.; Financial Accounting Foundation (FAF) | |||||
Richard W. Smirl, 1967* | Trustee and Senior Vice President | Trustee since 2010 and Senior Vice President since 2008 | Partner, William Blair & Company, L.L.C.; Limited Partner, WBC Holdings, L.P. (since 2008); Director, William Blair International, Ltd. (U.K.) (since 2012) | 25 | Director, William Blair SICAV; Director, William Blair MAS Ltd. | |||||
Non-Interested Trustees | ||||||||||
Vann A. Avedisian, 19642 | Trustee | Since 2012 | Principal, Highgate Holdings (hotel investments) since 2009; formerly co-founder and Managing Director, Oxford Capital Partners Inc., 1994 to 2006 | 25 | Potbelly Corporation | |||||
Kathleen T. Barr, 1955 | Trustee | Since 2013 | Retired; formerly, President, Productive Capital Management, Inc. (registered investment adviser to public entities) and Owner, KT Barr Consulting, LLC (mutual fund and investment management consulting) 2010 to 2013; prior thereto, Chief Administrative Officer, Senior Vice President and Senior Managing Director of Allegiant Asset Management Company (merged with PNC Capital Advisors, LLC in 2009) from 2004 to 2010; Chief Administrative Officer, Chief Compliance Officer and Senior Vice President of PNC Funds and PNC Advantage Funds (f/k/a Allegiant Funds) from 2003 to 2010 | 25 | AmericaFirst Quantitative Funds (5 portfolios) |
* | Ms. Seitz and Mr. Smirl are interested persons of the Trust because of their positions at William Blair & Company, L.L.C. (“William Blair”), the Trust’s investment adviser and principal underwriter. William Blair (a privately held company) is a wholly owned subsidiary of WBC Holdings, L.P., which is wholly owned by certain William Blair employees (employee owners are referred to as ‘partners’). |
See accompanying Notes to Financial Statements.
204 | Annual Report | December 31, 2014 |
Number of | ||||||||||
Term of | Portfolios | |||||||||
Office and | in Trust | |||||||||
Position(s) | Length of | Principal | Complex | |||||||
Held with | Time | Occupation(s) | Overseen | Other Directorships | ||||||
Name and Year of Birth | Trust | Served | During Past 5 Years | by Trustee | Held by Trustee | |||||
Phillip O. Peterson, 1944 | Trustee | Since 2007 | Retired; formerly, President, Strong Mutual Funds, 2004 to 2005; formerly, Partner, KPMG LLP | 25 | The Hartford Group of Mutual Funds (66 portfolios); Symetra Mutual Funds Trust (variable annuity funds) (2012 to 2014) | |||||
Donald J. Reaves, 19463 | Trustee | Since 2004 | Retired; formerly, Chancellor of Winston-Salem State University, 2007 to 2014; prior thereto, Vice President for Administration and Chief Financial Officer, University of Chicago, 2002 to 2007 | 25 | American Student Assistance Corp., guarantor of student loans; Amica Mutual Insurance Company | |||||
Donald L. Seeley, 1944 | Trustee | Since 2003 | Retired; formerly Director, Applied Investment Management Program, University of Arizona Department of Finance; prior thereto, Vice Chairman and Chief Financial Officer, True North Communications, Inc. (marketing communications and advertising firm) | 25 | Center for Furniture Craftsmanship (not-for-profit); Warnaco Group, Inc., intimate apparel, sportswear, and swimwear manufacturer (2005 to 2013); Beverly Enterprises, Inc., provider of elder care and rehabilitative services (2002 to 2006) | |||||
Thomas J. Skelly, 1951 | Trustee | Since 2007 | Advisory Board Member for various U.S. companies; Director and Investment Committee Chairman of the US Accenture Foundation, Inc.; prior to 2005, Managing Partner of various divisions at Accenture | 25 | Mutual Trust Financial Group, provider of insurance and investment products; Board Member, First MetLife Insurance Company, NY chartered company for Metropolitan Life Insurance; Clayton Holdings, Inc., provider of information-based analytics, consulting and outsourced services to various financial institutions and investors (2007 to 2008) |
(1) | Each Trustee serves until the election and qualification of a successor, or until death, resignation or retirement, or removal as provided in the Trust’s Declaration of Trust. Retirement for Non-Interested Trustees occurs no later than at the conclusion of the first regularly scheduled Board meeting of the calendar year that occurs after the earlier of (a) the Non-Interested Trustee’s 72nd birthday or (b) the 15th anniversary of the date that the Non-Interested Trustee became a member of the Board of Trustees. |
(2) | Mr. Avedisian has served as a member of the Board of Directors of Potbelly Corporation (“Potbelly”) since September 2001. In October 2013, Potbelly completed an underwritten initial public offering of its common stock (the “Offering”). William Blair served as a member of the underwriting syndicate. At the time of the Offering, Mr. Avedisian, through entities he owns or controls, indirectly beneficially owned 1,607,448 shares of Potbelly common stock and warrants to purchase 241,704 shares of common stock representing approximately 8.9% of the shares before the Offering. Mr. Avedisian disclaimed beneficial ownership of the shares except to the extent of his pecuniary interest therein. Potbelly sold 8,474,869 shares and certain stockholders, including two entities affiliated with William Blair, sold 150,131 shares in the Offering at a price to the public of $14.00 per share. Neither Mr. Avedisian nor the entities he owns or controls was a selling stockholder in the Offering. A portion of the net proceeds received by Potbelly from the Offering was used to pay a previously declared cash dividend, in an aggregate amount of approximately $49.9 million, on Potbelly common and preferred shares outstanding immediately prior to the closing of the Offering, which included the outstanding shares indirectly beneficially owned by Mr. Avedisian, William Blair and the two entities affiliated with William Blair. |
(3) | In his former role as chief financial officer at the University of Chicago, Mr. Reaves had a working relationship with E. David Coolidge III, Vice Chairman of the Adviser who is also a trustee of the University of Chicago. |
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 205 |
Term of Office | |||||||
Position(s) Held | and Length of | Principal Occupation(s) | |||||
Name and Year of Birth | with Trust | Time Served1 | During Past 5 Years2 | ||||
Officers | |||||||
Michael P. Balkin, 1959 | Senior Vice President | Since 2008 | Partner, William Blair & Company, L.L.C. | ||||
Stephanie G. Braming, 1970 | Senior Vice President | Since 2014 | Partner, William Blair & Company, L.L.C. | ||||
Karl W. Brewer, 1966 | Senior Vice President | Since 2000 | Partner, William Blair & Company, L.L.C. | ||||
Thomas Clarke, 1968 | Senior Vice President | Since 2011 | Partner, William Blair & Company, L.L.C. (since 2014); prior thereto, Associate, William Blair & Company, L.L.C. (2011-2014); Managing Partner, Singer Partners, LLC (2009-2011) | ||||
Simon Fennell, 1969 | Senior Vice President | Since 2013 | Partner, William Blair & Company, L.L.C. (since 2013); prior thereto, Associate, William Blair & Company, L.L.C. (2011-2013); Goldman Sachs (1997-2011) | ||||
Andrew G. Flynn, 1961 | Senior Vice President | Since 2013 | Partner, William Blair & Company, L.L.C. | ||||
David C. Fording, 1967 | Senior Vice President | Since 2006 | Partner, William Blair & Company, L.L.C. | ||||
James S. Golan, 1961 | Senior Vice President | Since 2005 | Partner, William Blair & Company, L.L.C. | ||||
Michael A. Jancosek, 1959 | Senior Vice President | Since 2000 | Partner, William Blair & Company, L.L.C. | ||||
John F. Jostrand, 1954 | Senior Vice President | Since 1999 | Partner, William Blair & Company, L.L.C. | ||||
Chad M. Kilmer, 1975 | Senior Vice President | Since 2006 | Partner, William Blair & Company, L.L.C. (since 2011); prior thereto, Associate, William Blair & Company, L.L.C. | ||||
Robert C. Lanphier IV, 1956 | Senior Vice President | Since 2003 | Partner, William Blair & Company, L.L.C. | ||||
Mark T. Leslie, 1967 | Senior Vice President | Since 2005 | Partner, William Blair & Company, L.L.C. | ||||
Matthew A. Litfin, 1972 | Senior Vice President | Since 2008 | Partner, William Blair & Company, L.L.C. | ||||
Kenneth J. McAtamney, 1966 | Senior Vice President | Since 2008 | Partner, William Blair & Company, L.L.C. | ||||
Todd M. McClone, 1968 | Senior Vice President | Since 2005 | Partner, William Blair & Company, L.L.C. | ||||
David Merjan, 1960 | Senior Vice President | Since 2008 | Partner, William Blair & Company, L.L.C. | ||||
David S. Mitchell, 1960 | Senior Vice President | Since 2003 | Partner, William Blair & Company, L.L.C. | ||||
John C. Murphy, 1969 | Senior Vice President | Since 2014 | Partner, William Blair & Company, L.L.C. | ||||
David P. Ricci, 1958 | Senior Vice President | Since 2006 | Partner, William Blair & Company, L.L.C. |
See accompanying Notes to Financial Statements.
206 | Annual Report | December 31, 2014 |
Term of Office | |||||||
Position(s) Held | and Length of | Principal Occupation(s) | |||||
Name and Year of Birth | with Trust | Time Served1 | During Past 5 Years2 | ||||
Brian D. Singer, 1960 | Senior Vice President | Since 2011 | Partner, William Blair & Company, L.L.C. (since 2012); prior thereto, Associate, William Blair & Company, L.L.C. (2011-2012), Managing Partner, Singer Partners, LLC (2009-2011) | ||||
Jeffrey A. Urbina, 1955 | Senior Vice President | Since 1998 | Partner, William Blair & Company, L.L.C. | ||||
Christopher T. Vincent, 1956 | Senior Vice President | Since 2002 | Partner, William Blair & Company, L.L.C. | ||||
David F. Hone, 1967 | Vice President | Since 2011 | Associate, William Blair & Company, L.L.C. (since 2011); prior thereto, Portfolio Manager—Large Cap Value, Deutsche Asset Management (2002-2010) | ||||
Kathleen M. Lynch, 1971 | Vice President | Since 2010 | Associate, William Blair & Company, L.L.C. | ||||
Paul J. Sularz, 1967 | Vice President | Since 2009 | Associate, William Blair & Company, L.L.C. (2006-2012 and since 2014); Partner, William Blair & Company, L.L.C. (2012-2014) | ||||
Colette M. Garavalia, 1961 | Treasurer | Since 2000 | Associate, William Blair & Company, L.L.C. | ||||
Andrew T. Pfau, 1970 | Secretary | Since 2009 | Associate, William Blair & Company, L.L.C. | ||||
John Raczek, 1970 | Assistant Treasurer | Since 2010 | Associate, William Blair & Company, L.L.C. | ||||
Walter R. Randall, Jr., 1960 | Chief Compliance Officer and Assistant Secretary | Since 2009 | Associate, William Blair & Company, L.L.C. |
(1) | The Trust’s officers, except the Chief Compliance Officer, are elected annually by the Board of Trustees. The Trust’s Chief Compliance Officer is designated by the Board of Trustees and may only be removed by action of the Board of Trustees, including a majority of independent trustees. Length of Time Served for all officers indicates the year the individual became an officer of the Trust. |
(2) | William Blair & Company, L.L.C. (“William Blair”) (a privately held company) is a wholly owned subsidiary of WBC Holdings, L.P., which is wholly owned by certain William Blair employees (employee owners are referred to as ‘partners’). |
The Statement of Additional Information for the William Blair Funds includes additional information about the trustees and is available without charge by calling 1-800-635-2886 (in Massachusetts 1-800-635-2840) or by writing the Fund.
See accompanying Notes to Financial Statements.
December 31, 2014 | William Blair Funds | 207 |
(Unaudited)
Proxy Voting
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities and information regarding how the Funds voted proxies relating to portfolio securities for the most recent 12-month period ended December 31 are available without charge, upon request, by calling 1-800-635-2886 (in Massachusetts 1-800-635-2840), at www.williamblairfunds.com and on the SEC’s website at http://www.sec.gov.
Quarterly Portfolio Schedules
Each Fund files its complete schedule of portfolio holdings with the SEC for the first and third fiscal quarters of each fiscal year (quarters ended March 31 and September 30) on Form N-Q. The Fund’s Forms N-Q are available on the SEC’s website at http://www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation of the SEC’s Public Reference Room may be obtained by calling 1-800-SEC-0330.
Additional Federal Income Tax Information: (unaudited)
Under Section 852(b)(3)(C) of the Code, the Funds hereby designate the following amounts as capital gain dividends for the fiscal year ended December 31, 2014 (in thousands):
Fund | Capital Gain Dividend | |||
Growth | $ | 121,860 | ||
Large Cap Growth | 4,759 | |||
Large Cap Value | 382 | |||
Mid Cap Growth | 48,240 | |||
Mid Cap Value | 465 | |||
Small-Mid Cap Growth | 68,782 | |||
Small-Mid Cap Value | 288 | |||
Small Cap Growth | 81,991 | |||
Small Cap Value | 19,782 | |||
Global Leaders | 258 | |||
Global Small Cap Growth | 1,221 | |||
International Leaders | 9 | |||
Institutional International Growth | 186,607 | |||
International Small Cap Growth | 88,688 | |||
Emerging Markets Leaders | 2,645 | |||
Emerging Markets Growth | 51,882 | |||
Emerging Markets Small Cap Growth | 10,816 | |||
Bond | 5 |
In January 2015, investors were notified on IRS Form 1099-Div or substitute 1099 DIV as to the Federal tax status of the distributions received by investors in the calendar year 2014.
208 | Annual Report | December 31, 2014 |
Useful Information About Your Report (Unaudited)
Please refer to this information when reviewing the Expense Example for each Fund.
Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees, distribution (12b-1) fees (for Class N shares except for the Institutional International Growth Fund, the Institutional International Equity Fund, and the Ready Reserves Fund), service fees (for Class N shares of the Ready Reserves Fund), shareholder administration fees (for Class N and Class I shares of the Global Leaders Fund, the Global Small Cap Growth Fund, the International Leaders Fund, the International Small Cap Growth Fund, the Emerging Markets Leaders Fund, the Emerging Markets Growth Fund, the Emerging Markets Small Cap Growth Fund, the Bond Fund, the Low Duration Fund and the Macro Allocation Fund) and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. To do so, compare the Fund’s 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period from July 1, 2014 to December 31, 2014.
Actual Expenses
In each example, the first line for each share class in the table provides information about the actual account values and actual expenses. These expenses reflect the effect of any expense cap applicable to the share class during the period. Without this expense cap, the costs shown in the table would have been higher. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during the period.
Hypothetical Example for Comparison Purposes
In each example, the second line for each share class in the table provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. This is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund to other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in both examples are meant to highlight your ongoing costs only and do not reflect any transactional costs or account type fees, such as IRA Fiduciary Administration fees. These fees are fully described in the prospectus. Therefore, the second line of each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative costs of owning different funds. In addition, if these transactional costs or account fees were included, your costs would have been higher.
December 31, 2014 | William Blair Funds | 209 |
Beginning | Ending | Expenses Paid | ||||||||||||||
Account Value | Account Value | During | Annualized | |||||||||||||
Expense Example | 7/1/2014 | 12/31/2014 | the Period (a) | Expense Ratio | ||||||||||||
Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,030.35 | $ | 6.04 | 1.18 | % | ||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.05 | $ | 6.08 | 1.18 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,031.85 | $ | 4.40 | 0.86 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,045.66 | $ | 4.43 | 0.86 | |||||||||
Large Cap Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,068.32 | $ | 5.73 | 1.10 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.45 | $ | 5.67 | 1.10 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,069.85 | $ | 4.43 | 0.85 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,045.72 | $ | 4.38 | 0.85 | |||||||||
Large Cap Value Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,020.87 | $ | 5.60 | 1.10 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.45 | $ | 5.67 | 1.10 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,023.02 | $ | 4.33 | 0.85 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,045.72 | $ | 4.38 | 0.85 | |||||||||
Mid Cap Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,052.51 | $ | 6.98 | 1.35 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.19 | $ | 6.95 | 1.35 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,054.32 | $ | 5.70 | 1.10 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.45 | $ | 5.67 | 1.10 | |||||||||
Mid Cap Value Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,039.99 | $ | 6.94 | 1.35 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.19 | $ | 6.95 | 1.35 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,040.55 | $ | 5.66 | 1.10 | |||||||||
Class I-hypothetical 5% return. | $ | 1,000.00 | $ | 1,044.45 | $ | 5.67 | 1.10 | |||||||||
Small-Mid Cap Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,060.76 | $ | 7.01 | 1.35 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.19 | $ | 6.95 | 1.35 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,062.54 | $ | 5.72 | 1.10 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.45 | $ | 5.67 | 1.10 | |||||||||
Small-Mid Cap Value Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,010.12 | $ | 7.09 | 1.40 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.94 | $ | 7.21 | 1.40 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,011.58 | $ | 5.83 | 1.15 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.20 | $ | 5.93 | 1.15 | |||||||||
Small Cap Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,014.40 | $ | 7.62 | 1.50 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.44 | $ | 7.72 | 1.50 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,015.52 | $ | 6.35 | 1.25 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.70 | $ | 6.44 | 1.25 | |||||||||
Small Cap Value Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,014.92 | $ | 7.62 | 1.50 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.44 | $ | 7.72 | 1.50 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,016.29 | $ | 6.25 | 1.23 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.80 | $ | 6.34 | 1.23 | |||||||||
Global Leaders Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 992.40 | $ | 7.53 | 1.50 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.44 | $ | 7.72 | 1.50 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 993.84 | $ | 6.28 | 1.25 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.70 | $ | 6.44 | 1.25 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 993.68 | $ | 0.00 | 1.10 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.45 | $ | 5.67 | 1.10 | |||||||||
Global Small Cap Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 992.11 | $ | 8.28 | 1.65 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,041.68 | $ | 8.49 | 1.65 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 994.49 | $ | 7.04 | 1.40 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.94 | $ | 7.21 | 1.40 |
210 | Annual Report | December 31, 2014 |
Fund Expenses (Unaudited)
Beginning | Ending | Expenses Paid | ||||||||||||||
Account Value | Account Value | During | Annualized | |||||||||||||
Expense Example | 7/1/2014 | 12/31/2014 | the Period (a) | Expense Ratio | ||||||||||||
International Leaders Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 948.58 | $ | 7.12 | 1.45 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.69 | $ | 7.47 | 1.45 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 950.11 | $ | 5.90 | 1.20 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.95 | $ | 6.18 | 1.20 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 950.30 | $ | 5.16 | 1.05 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.71 | $ | 5.41 | 1.05 | |||||||||
International Equity Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 926.31 | $ | 6.55 | 1.35 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.19 | $ | 6.95 | 1.35 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 927.67 | $ | 5.34 | 1.10 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.45 | $ | 5.67 | 1.10 | |||||||||
Institutional International Equity Fund | ||||||||||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 928.43 | $ | 4.86 | 1.00 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.96 | $ | 5.15 | 1.00 | |||||||||
International Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 940.24 | $ | 7.04 | 1.44 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.74 | $ | 7.41 | 1.44 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 941.63 | $ | 5.58 | 1.14 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.25 | $ | 5.87 | 1.14 | |||||||||
Institutional International Growth Fund | ||||||||||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 942.49 | $ | 4.75 | 0.97 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,045.11 | $ | 5.00 | 0.97 | |||||||||
International Small Cap Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 903.92 | $ | 7.58 | 1.58 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.04 | $ | 8.13 | 1.58 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 905.09 | $ | 6.15 | 1.28 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.55 | $ | 6.59 | 1.28 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 906.42 | $ | 5.09 | 1.06 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.66 | $ | 5.46 | 1.06 | |||||||||
Emerging Markets Leaders Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 962.46 | $ | 8.16 | 1.65 | |||||||||
Class N-hypothetical 5% return. | $ | 1,000.00 | $ | 1,041.68 | $ | 8.49 | 1.65 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 964.75 | $ | 6.93 | 1.40 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.94 | $ | 7.21 | 1.40 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 965.25 | $ | 6.19 | 1.25 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.70 | $ | 6.44 | 1.25 | |||||||||
Emerging Markets Growth Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 962.23 | $ | 8.11 | 1.64 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,041.73 | $ | 8.44 | 1.64 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 963.75 | $ | 6.93 | 1.40 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.94 | $ | 7.21 | 1.40 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 963.99 | $ | 5.84 | 1.18 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,044.05 | $ | 6.08 | 1.18 | |||||||||
Emerging Markets Small Cap Growth Fund | ||||||||||||||||
Class N-actual return. | $ | 1,000.00 | $ | 1,029.66 | $ | 8.44 | 1.65 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,041.68 | $ | 8.49 | 1.65 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,030.83 | $ | 7.17 | 1.40 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,042.94 | $ | 7.21 | 1.40 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 1,031.35 | $ | 6.40 | 1.25 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,043.70 | $ | 6.44 | 1.25 | |||||||||
Bond Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,006.86 | $ | 3.29 | 0.65 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,046.72 | $ | 3.35 | 0.65 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,007.52 | $ | 2.53 | 0.50 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,047.48 | $ | 2.58 | 0.50 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | �� | $ | 1,008.27 | $ | 1.77 | 0.35 | ||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,048.24 | $ | 1.81 | 0.35 |
December 31, 2014 | William Blair Funds | 211 |
Fund Expenses (Unaudited)
Beginning | Ending | Expenses Paid | ||||||||||||||
Account Value | Account Value | During | Annualized | |||||||||||||
Expense Example | 7/1/2014 | 12/31/2014 | the Period (a) | Expense Ratio | ||||||||||||
Income Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,004.33 | $ | 4.24 | 0.84 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,045.77 | $ | 4.33 | 0.84 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,005.68 | $ | 2.98 | 0.59 | |||||||||
Class I-hypothetical 5% return | $ | 1,000.00 | $ | 1,047.03 | $ | 3.04 | 0.59 | |||||||||
Low Duration Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,004.15 | $ | 3.54 | 0.70 | |||||||||
Class N-hypothetical 5% | $ | 1,000.00 | $ | 1,046.47 | $ | 3.61 | 0.70 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 1,003.84 | $ | 2.78 | 0.55 | |||||||||
Class I-hypothetical 5% | $ | 1,000.00 | $ | 1,047.23 | $ | 2.84 | 0.55 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 1,005.67 | $ | 2.02 | 0.40 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,047.98 | $ | 2.06 | 0.40 | |||||||||
Ready Reserves Fund | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 1,000.05 | $ | 0.35 | 0.07 | |||||||||
Class N-hypothetical 5% return | $ | 1,000.00 | $ | 1,049.65 | $ | 0.36 | 0.07 | |||||||||
Macro Allocation Fund (b) | ||||||||||||||||
Class N-actual return | $ | 1,000.00 | $ | 980.01 | $ | 2.23 | 1.35 | |||||||||
Class N-hypothetical 5% | $ | 1,000.00 | $ | 1,047.74 | $ | 6.97 | 1.35 | |||||||||
Class I-actual return | $ | 1,000.00 | $ | 980.61 | $ | 1.77 | 1.07 | |||||||||
Class I-hypothetical 5% | $ | 1,000.00 | $ | 1,048.21 | $ | 5.52 | 1.07 | |||||||||
Institutional Class-actual return | $ | 1,000.00 | $ | 980.94 | $ | 1.46 | 0.88 | |||||||||
Institutional Class-hypothetical 5% return | $ | 1,000.00 | $ | 1,048.53 | $ | 4.54 | 0.88 |
(a) | Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by the number of days in the period, 184, and divided by 365 (to reflect the one-half year period). |
(b) | The Macro Allocation Fund figures reflect the fiscal period from November 1, 2014 to December 31, 2014. Expenses are equal to the annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the period, 61, divided by 365. |
212 | Annual Report | December 31, 2014 |
BOARD OF TRUSTEES | |
Vann A. Avedisian | |
Principal, Highgate Holdings | |
Kathleen T. Barr | |
Retired Senior Managing Director, PNC Capital Advisors, LLC | |
Phillip O. Peterson | |
Retired Partner, KPMG LLP | |
Donald J. Reaves | |
Retired Chancellor, Winston-Salem State University | |
Donald L. Seeley | |
Retired Adjunct Lecturer and Director, University of Arizona Department of Finance | |
Michelle R. Seitz, Chairman and President | |
Partner, William Blair & Company, L.L.C. | |
Thomas J. Skelly | |
Retired Managing Partner, Accenture U.S. | |
Richard W. Smirl, Senior Vice President | |
Partner, William Blair & Company L.L.C. | |
Officers | |
Michael P. Balkin, Senior Vice President | |
Stephanie G. Braming, Senior Vice President | |
Karl W. Brewer, Senior Vice President | |
Thomas Clarke, Senior Vice President | |
Simon Fennell, Senior Vice President | |
Andrew G. Flynn, Senior Vice President | |
David C. Fording, Senior Vice President | |
James S. Golan, Senior Vice President | |
Michael A. Jancosek, Senior Vice President | |
John F. Jostrand, Senior Vice President | |
Chad M. Kilmer, Senior Vice President | |
Robert C. Lanphier, IV, Senior Vice President | |
Mark T. Leslie, Senior Vice President | |
Matthew A. Litfin, Senior Vice President | |
Kenneth J. McAtamney, Senior Vice President | |
Todd M. McClone, Senior Vice President | |
David Merjan, Senior Vice President | |
David S. Mitchell, Senior Vice President | |
John C. Murphy, Senior Vice President | |
David P. Ricci, Senior Vice President | |
Brian D. Singer, Senior Vice President | |
Jeffrey A. Urbina, Senior Vice President | |
Christopher T. Vincent, Senior Vice President | |
David F. Hone, Vice President | |
Kathleen M. Lynch, Vice President | |
Paul J. Sularz, Vice President | |
Colette M. Garavalia, Treasurer | |
Andrew T. Pfau, Secretary | |
John M. Raczek, Assistant Treasurer | |
Walter R. Randall, Jr., Chief Compliance Officer and Assistant Secretary | |
Investment Adviser | |
William Blair & Company, L.L.C. | |
Independent Registered Public Accounting Firm | |
Ernst & Young LLP | |
Legal Counsel | |
Vedder Price P.C. | |
Transfer Agent | |
Boston Financial Data Services, Inc. | |
P.O. Box 8506 | |
Boston, MA 02266-8506 | |
For customer assistance, call 1-800-635-2886 | |
(Massachusetts 1-800-635-2840) |
December 31, 2014 | William Blair Funds | 213 |
William Blair Funds | |||||
DOMESTIC EQUITY | GLOBAL EQUITY | FIXED-INCOME | |||
Growth Fund | Global Leaders Fund | Bond Fund | |||
Large Cap Growth Fund | Global Small Cap Growth Fund | Income Fund | |||
Large Cap Value Fund | Low Duration Fund | ||||
Mid Cap Growth Fund | INTERNATIONAL EQUITY | ||||
Mid Cap Value Fund | International Leaders Fund | MONEY MARKET | |||
Small-Mid Cap Growth Fund | International Equity Fund | Ready Reserves Fund | |||
Small-Mid Cap Value Fund | Institutional International Equity Fund | ||||
Small Cap Growth Fund | International Growth Fund | MULTI-ASSET AND | |||
Small Cap Value Fund | Institutional International Growth Fund | ALTERNATIVE | |||
International Small Cap Growth Fund | Macro Allocation Fund | ||||
Emerging Markets Leaders Fund | |||||
Emerging Markets Growth Fund | |||||
Emerging Markets Small Cap Growth Fund |
© | William Blair & Company, L.L.C., distributor | |||
+1 800 742 7272 | 222 West Adams Street | |||
williamblairfunds.com | Chicago, Illinois 60606 | 00103188 |
Item 2. | Code of Ethics |
As of the end of the period covered by this Form N-CSR, the Registrant has adopted a code of ethics that applies to its principal executive officer and principal financial officer. Such code of ethics is posted on the Registrant’s website: www.williamblairfunds.com. There were no amendments to or waivers of the code of ethics during the period covered by this report.
Item 3. | Audit Committee Financial Expert |
The Registrant’s Board of Trustees has determined that the Registrant has at least one “audit committee financial expert” (as defined in Item 3 of Form N-CSR) serving on its Audit Committee. Mr. Phillip O. Peterson, the Registrant’s audit committee financial expert, is “independent” for purposes of Item 3 to Form N-CSR.
An “audit committee financial expert” is not an “expert” for any purpose, including for purposes of Section 11 of the Securities Act of 1933, as a result of being designated as an “audit committee financial expert.” Further, the designation of a person as an “audit committee financial expert” does not mean that the person has any greater duties, obligations, or liability than those imposed on the person without the “audit committee financial expert” designation. Similarly, the designation of a person as an “audit committee financial expert” does not affect the duties, obligations, or liability of any other member of the audit committee or Board of Trustees.
Item 4. | Principal Accountant Fees and Services |
Audit Fees
For the fiscal years ended December 31, 2013 and 2014, Ernst & Young, LLP, the Registrant’s principal accountant (“E&Y”), billed the Registrant $647,000 and $708,600, respectively, for professional services rendered for the audit of the Registrant’s annual financial statements or services that are normally provided in connection with statutory and regulatory filings.
Audit-Related Fees
For the fiscal years ended December 31, 2013 and 2014, E&Y billed the Registrant $4,270 and $0, respectively, for assurance and related services that are reasonably related to the performance of the audit of the Registrant’s financial statements and that are not reported above, such as reviewing prospectuses, semiannual reports and SEC filings. For the fiscal years ended December 31, 2013 and 2014, E&Y provided no audit-related services to William Blair & Company L.L.C., the Registrant’s investment advisor (“William Blair”) or any of its control affiliates that were for engagements directly related to the Registrant’s operations and financial reporting.
Tax Fees
For the fiscal years ended December 31, 2013 and 2014, E&Y billed the Registrant $267,800 and $256,150, respectively, for professional services rendered for tax compliance, tax advice and tax planning. Such services consisted of preparation of tax returns, year-end distribution review, qualifying dividend income analysis and computation of foreign tax credit pass-through. For the fiscal years ended December 31, 2013 and 2014, E&Y did not bill William Blair and its control affiliates for any services that were for engagements directly related to the Registrant’s operations and financial reporting.
All Other Fees
For the fiscal years ended December 31, 2013 and 2014, E&Y did not bill the Registrant for products and services other than the services reported above. For the fiscal year ended December 31, 2013 and 2014, E&Y provided no other services to William Blair or any of its control affiliates that were for engagements directly related to the Registrant’s operations and financial reporting.
Audit Committee Pre-Approval Policies and Procedures
Pursuant to Registrant’s Audit Committee Charter (the “Charter”), the Audit Committee is responsible for pre-approving any engagement of the principal accountant to provide non-prohibited services to the Registrant, including the fees and other compensation to be paid to the principal accountant, to the extent required by Rule 2-01(c)(7) of Regulation S-X. Pursuant to the Charter, the Audit Committee is also responsible for pre-approving any engagement of the principal accountant, including the fees and other compensation to be paid to the principal accountant, to provide non-audit services to the Registrant’s investment advisor (or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the Registrant), if the engagement relates directly to the operations and financial reporting of the Registrant, to the extent required by Rule 2-01(c)(7) of Regulation S-X. The Chair of the Audit Committee may grant the pre-approval referenced above for non-prohibited and non-audit services. All such delegated pre-approvals will be presented to the Audit Committee no later than the next Audit Committee meeting.
Item 5. | Audit Committee of Listed Registrants |
Not Applicable to this Registrant, insofar as the Registrant is not a listed company.
Item 6. | Schedule of Investments |
See Schedule of Investments in Item 1.
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies |
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
Item 8. | Portfolio Managers of Closed Investment Companies |
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
Item 9. | Purchase of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers |
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
Item 10. | Submission of Matters to a Vote of Security Holders |
There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees since the Registrant last provided disclosure in response to this item.
Item 11. |
Controls and Procedures
(a) The Registrant’s principal executive and principal financial officer, or persons performing similar functions, have concluded that the Registrant’s Disclosure Controls and Procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c)) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3 (b) under the 1940 Act (17 CFR 270.30a-3(b) and Rules 13a-15(b) or 15d-15(b) under the Exchange Act (17 CFR 240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the final quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.
Item 12. | Exhibits |
12. (a) (1) Code of Ethics
Not applicable because it is posted on Registrant’s website.
12. (a) (2) (1)
Certification of Principal Executive Officer Required by Rule 30a-2(a) of the Investment Company Act
12. (a) (2) (2)
Certification of Principal Financial Officer Required by Rule 30a-2(a) of the Investment Company Act.
12. (a) (3)
Not applicable to this Registrant.
12. (b)
Certification of Chief Executive Officer and Certification of Chief Financial Officer Required by Rule 30a-2(b) of the Investment Company Act
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
William Blair Funds | ||
/s/ Michelle R. Seitz | ||
By: | Michelle R. Seitz | |
President (Chief Executive Officer) |
Date: February 20, 2015
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated
/s/ Michelle R. Seitz | ||
By: | Michelle R. Seitz | |
President (Chief Executive Officer) |
Date: February 20, 2015
/s/ Colette M. Garavalia | ||
By: | Colette M. Garavalia | |
Treasurer (Chief Financial Officer) |
Date: February 20, 2015